Qtrax Causing a Stir

qtraxQtrax, an advertising-supported peer-to-peer music service, wants to bring you back to the days of downloading music without having to set aside money for your favorite tracks. Thinking you won’t mind listening to a short ad or seeing a small advertising window in your Qtrax player, the company is going by the motto “you play the music, we pay the artists.” The only problem is that Qtrax announced the you play the music before actually paying and firming up deals with the artists (or labels). Over the weekend, Qtrax CEO Allan Klepfisz announced the availability of 25 million free legal song downloads through the service, but he seemed to forget to coordinate the announcement with the partnering music labels. Reuters was quick to report that Warner Music Group Corp and Sony BMG, “denied that they have agreed to license songs for a free download service that was launched by Qtrax on Monday.” Sure, Allan Klepfisz jumped the gun. But I spoke with him way back last July. Perhaps he just couldn’t wait any longer to spill the beans. Here are some of the questions and answers from my interview with him. What is about the state of digital music that has made you want to start a company like Qtrax? You have a whole generation of kids who grew up feeling that free music is their birthright. They don’t have to pay for search, or news or the increasing amount of video on the Internet. And it seems unlikely that music will remain this sacrosanct area that people have to exclusively pay for. If consumers aren’t going to be the ones paying, the obvious candidate to pay is advertisers. What is the range of music that will be available to the Qtrax user? It will be a much larger catalog than is available on any current legal site because we are using p2p as our foundation. There will be certain exclusions from the p2p catalog, but very few. Consumers will be able to find a huge quantity of songs – north of 20 million songs—as well as some rare gems that they can’t always find on the sanitized legal site. We are absolutely including Indie bands as well as live recordings of performances. How will the advertising feel in Qtrax? The advertising will look and feel like most advertising on the Internet. We are looking to pioneer some new forms as well. In all cases the advertising will be highly targeted. If advertising has great relevance to the listener it will be perceived as less interfering. There also won’t be any need to absorb any advertising in order to listen to the music; it will merely just be in the space. There will be no precondition to listen to the advertising to listen to the music you want. Does that mean that ads won’t be part of the track? In general it won’t be. We might occasionally have audio advertising but certainty a prelisting to an ad before a track won’t be forced, it will come after the music track. We are doing things that are tailored to searches. If you were to search Madonna, for example, then we would present you with products that are related to Madonna from her albums to DVDs to ringtones. How will it differ from competitors like SpiralFrog or Ruckus? We would like to believe that nobody is precise in our space. It is true that free music has been offered with advertising support, but we are the first to do it in the p2p arena. Since that is really where people hang out, we are offering a legal solution which is closest to what people are currently doing. If people are paying with their time, does that mean there aren’t plans to charge for any of the music? We will be making available the library of songs in pristine quality for purchase. That means CD quality recording quality. We will be able to finger print the songs that customers are listening to so there will be a limit to how many times you can play some of the free songs. There is a limit on the major labels and in general no limit when it comes to the Indies. We think the major’s limit will be pretty flexible but that remains to be seen. Will Qtrax music be able to be brought to iPods and other mobile music devices? We believe we will be able to arrange the portability of most songs before launch. Technologically it is a struggle to get advertisers to pay for portable songs. We are considering options where the audio ad plays after a song and on screen advertising when your device is docked.

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