Sunday, December 11, 2005

Innovative Music Distribution Agreement

It's about 10pm and I just received a "pre-press release" from Weedshare's CEO, John Beezer. It truly is exciting news and I just had to sit down and share it with you before you read all about it online tomorrow. Those of you following the music industry's multi-year recession will most likely find the triumvirate announcement a rare beacon of light shining into the unknown darkness of the future of digital music distribution... Instead of waiting to see where the dust settles from the tumultuous climate, three relatively new companies are boldly rewriting the rules and leading the rest of the industry into unchartered waters with a slow and steady keel...

So what's the big news you ask? In a nutshell, online record label Magnatune has inked a deal with Weedshare and its superdistribution model to legally distribute protected uncompressed audio files on Limewire's upcoming P2P network called LimeClick . This new authorized content portal will reportedly serve as a primary distribution source for the files on the Gnutella network... (If you're new to the whole weedshare concept, I wrote a brief summary which was featured in entertainment attorney Steve Gordon's The Future of The Music Business...) Anyway, enough shameless self promotion... As a result of this unique partnership, the three innovative companies will cooperatively distribute and promote Magnatune's 200 independent artists (roughly 400 Cd's) via Weedshare's legal file sharing service. "Because Weed's commerce features are built into each file, the Weed format makes it simple for artists, record labels, bloggers, podcasters, social networkers, and dedicated music lovers to sell music on the Internet. The most difficult aspects of selling digital music - rights clearance and setting up e-commerce systems - are already taken care of with Weed files."

The bottom line is that artists get paid 50% of every sale - no matter what!

That's awesome progress, but there were a few other things that really caught my attention though...

1) Using the Weed format, Podcasters can now sell and monetize the actual songs they're playing on their shows (i.e., allowing people to download it on demand or via subscription) and thus build a valid business model for their continued existence...

2) Also, I've been preaching lately the fact that American consumers will never fully swallow the DRM pill, especially after the recent Sony/BMG rootkit debacle, which has now been expanded to include SunComm's MediaMax too... Let's face it, trying to protect Redbook audio files released on CD's just isn't going to work. "If you can't beat'em.....join'em......." It's time for the major labels to wake up and smell the coffee and at least acknowledge the handwriting on the wall... There are many of us in the industry that think the global music economy would recover much quicker if sincere efforts were made to develop softer copyright solutions that use DRM as an efficient accounting/tracking tool, rather than as a lock...

Basically, we have an entire new generation that thinks that downloads are free and that media/intellectual property usage rules and restrictions are made to be broken. With Magnatune's latest offering of high fidelity lossless audio files, customers can now burn true "CD quality" discs with DRM that's practically invisible after you buy the file. These CD's can then be ripped to MP3 or any other desired format with no second-generation quality loss (unlike all other existing offerings that are protected with DRM). That's really cool and as an audio engineer/producer who painstakingly massages each mix - I've been waiting a long time for this capability... Why should I settle for less quality when purchasing music online?? Now I don't have to...

So, what does this all mean to me you ask? What it means from a macro perspective is that the major record labels are one step closer to losing their vise-like grip on controlling online music distribution and they better hurry up and "get hip' to giving the consumer what he/she wants or the game will be over before they even step up to the plate... From a micro perspective, the bar has been permanently raised for delivering better sounding music with greater freedom and flexibility...

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