Watching the Qtrax PR fiasco unfold over the last few days (”we have all four majors on board, err, no we don’t”, “we’ve launched, err, no we haven’t”) provided a great lesson in what not to do when launching a new product i.e. lie to reporters. However, a ton of questions remain unanswered, not least of which being: is a free and legal music download service on the scale of Qtrax too good to be true?
But first, a recap of what Qtrax claims to be offering.
Qtrax is a free and legal peer-to-peer (P2P) music sharing service where users can “discover new music and legally download full-length, high-quality versions of their favorite songs while compensating both the artists and the record labels through non-intrusive and relevant advertising”. In order to achieve this, the service claims support from the four “major record labels and all of their respective publishing divisions”.
The result is a service able to legitimately offer 5 million tracks, growing to 25 million, and these could also include “grey music” i.e. bootlegs and live recordings or other unofficial releases, or so Qtrax claims.
The only catch is that tracks are wrapped in DRM to, presumably, restrict playback to within the Qtrax desktop player where the ads are served (Windows PC-only, with Mac support forthcoming). Magically, however, iPod support is also on its way, though not sanctioned by Apple, and the service will work with other portable music players.
However, as the UK’s Times newspaper reports, Qtrack hasn’t secured the signature of all four majors, far from it:
A spokesman for Universal, the largest of the labels, told Times Online today that it was “in discussion” with Qtrax, but that no agreement was in place. A source at Warner said: “Warner Music Group has not authorised the use of our content on Qtrax’s recently announced service.”
Both Sony BMG and EMI also confirmed to Times Online that Qtrax did not have the right to use their recorded music catalogue – contradicting a statement on Qtrax’s site, which was down periodically during the morning because of ‘overwhelming demand’, that its users would have access to 25 million songs.
Frankly, I find this unsurprising. If Apple can’t persuade all four majors to license their catalogs for DRM-free paid-for downloads, and even Amazon, seen as the company most likely to rescue the music industry away from the grip of Apple, is only able to do so on a trial basis (with regards to Universal and Sony BMG at least), then what chance does Qtrax have with an almost completely new and unproven model.
To put this into even greater perspective, both SpiralFrog (see our review) and We7, two services that have offered ad-supported music downloads for significantly longer, are only able to offer a catalog of around half a million tracks each one million and 80,000 tracks each. Why? Because the labels are far from convinced that advertising dollars can ever replace revenue from paid-for downloads or CD sales.
Also note that Nokia’s “free” eat-all-you-want subscription service, “Comes With Music”, only has the support of one major label: Universal.
The point is that the majors are very much at the experimental stage, taking a cautious approach to new business models, dipping one toe in the water. As a result, I’m sure a few of the major labels will at least license some of their catalog to Qtrax for some of the time. Then they’ll sit back and wait for the hard numbers to come in. That’s the trend we’re seeing across all new models for monetizing music.
As for circumventing Apple’s closed DRM technology used on the iPod, Qtrax has no chance. Others such as Real Networks have tried to play that cat and mouse game, eventually to concede defeat and give up.
