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Labels finally admit that p2p business model is legit

It is more than a bit confusing how the major labels can all have recognized only recently that DRM failed as a business model in connection with sales of tracks, and simultaneously have finally embraced p2p supported by advertising, but with DRM: Major Labels Allow P2P Music Sharing on QTrax | Listening Post from Wired.com. Why would they think that DRM would work in this context when it has failed so thoroughly in the non-p2p context? Just when it seemed that they were getting it together...

But, DRM aside, as many people probably know, scholars have long suggested that other revenues besides those tied to sales of copies were fully capable of compensating artists and distributors (but then, isn't that word just about to the point of being an oxymoron here?) for their contributions to a finished music product or experience. Terri Fisher's, "Promises to Keep," and Neil Netanel's NUL (Nonprofit use license) are two examples. See also Rob Kasunic's thoughtful analysis of The P2P Problem on Stanford's Fair Use site.

But, questionable reliance on DRM aside, this is pretty amazing. The text of the Wired article, "Major Labels Allow P2P Music Sharing on QTrax," admits they tried a dumb, 10 year-long experiment and it failed miserably, but they felt compelled to do it, and now they want to move forward. "Oh, whoops. We were wrong. P2P isn't all bad. Now come play with us." One of the comments sums up how perhaps many people greet this generous offer:

What the heck?! The Music Industry could have made a deal like this with Napster years ago and could have been rolling in so much money they wouldn't know what to do with it, but no they had to go and kill Napster and tick off millions of music fans in the process. I think this is too little too late for the RIAA. They've burned too many bridges in recent years. Their days are numbered.
Another sentiment repeatedly expressed in the comments was,
DRM? No iPod support? Count 99.9% of the market out then, guys. What a joke. No different than other subscription services - the main difference is that the bandwidth cost is lower for QTrax and the labels because the CONSUMER is paying for the bandwidth - on their own broadband lines! What an insult.

So, it's good news certainly, but is it too little too late for the labels? And what is the role of copyright in the future of media if business models really do turn to forms of payment that don't seem to need to exploit a monopoly? Very interesting!

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This page contains a single entry from the blog posted on January 27, 2008 4:49 PM.

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