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Major Labels Still Have no Qtrax Deal
January 28, 2008
Thomas Mennecke
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Imagine the surprise of the file-sharing community when 12 PM EST rolled around and Qtrax didn’t launch their new music downloading service. Such legal and industry authorized promises have been made before - remember MashBoxx? Despite a media frenzy preceding Qtrax’s launch, absolutely nothing has come to fruition. No downloading service, no MP3s, and apparently no deals with the entertainment industry.

The name “Qtrax” may conjure up some memories. Qtrax was once called “Qtrax Maxx” during a brief time after Napster. Like many P2P start-ups, the company closed in reaction to the entertainment industry’s tireless campaign against unauthorized digital distribution. Yet the name managed to surface once again in a massive media blitz.

The mainstream media managed to eat up Qtrax’s press releases hook, line and sinker. Headlines championed the first “legal” P2P service, and credited the company with achieving a groundbreaking accomplishment. No P2P entity has managed to score a distribution deal with all four major music labels, at least one that functioned within the context of a file-sharing network.

Considering that Qtrax hasn’t launched, its technical details are still a bit muddled. What we do know is that it’s a Mozilla Firefox based client, which grabs music tracks from the Gnutella network. From there, it manages to protect each file with Microsoft DRM. According to Qtrax, users will be able to select from 25-30 million song titles for free, in exchange for viewing advertisements. Revenue collected from advertisements would be used to compensate artists and the music labels. With a press release stating that Qtrax is the “…first free P2P service to be fully embraced by the music industry…”, finally a solution was in place to mitigate unauthorized downloads.

Not exactly.

When midnight came and went without a launch, journalists and bloggers immediately smelled blood in the water. Has another dream of legal, industry endorsed P2P been shattered by reality? Did the major four record labels (Sony-BMG, Universal Music, EMI, and Warner Music) back out, or were they never really on board? As it turns out, currently NONE of the major 4 record labels are currently on board with Qtrax. Slyck caught up with the four major labels this afternoon to see if their agreement status has changed. There has been no change.

EMI

EMI initially had an agreement with Qtrax to test their ad supported theory in a controlled environment, however that arrangement did not cover Qtrax's latest ambitions. There is some optimism that the most liberal of the four major music labels might sign on, however nothing has been written in stone just yet.

“EMI Music's initial agreement with Qtrax has lapsed ([it] was a license designed to help us experiment with the ad supported model, but Qtrax didn't launch their service during the period of the agreement). We are now in talks with the company about a possible new deal but as of today, they don't have a license with EMI Music.”

There’s some good news for Qtrax, however, as the separate EMI Music Publishing division does have a distribution agreement with Qtrax. Not exactly 30 million tracks, but it’s a start.

“EMI Music Publishing *does* have a deal with Qtrax,” EMI told Slyck.

Sony BMG

Sony-BMG Music was straightforward with their response, and bluntly stated, “Sony-BMG does not have a license agreement [with Qtrax]."

Warner

Like the other music labels, Warner Music Group's position is not in concert with Qtrax.

"Warner Music Group has not authorized the use of our content on Qtrax’s recently announced service," a Warner spokesperson told Slyck.com.

Universal Music

Universal Music Group’s Peter Lofrumento was more expressive, indicating that talks are ongoing however incomplete.

“While we are in discussions with QTrax, we have not yet signed an agreement. We expect that we will sign an agreement at some point.”

Considering the delicate and business nature of the negotiations, where large amounts of revenue are at stake, there’s little the record labels could openly discuss. However, despite this setback, Qtrax’s president and CEO Allan Klepfisz remains committed to their ambitions and will continue their negotiations. When we called Qtrax to obtain an update on their end, we were told that more press releases are coming.

In the absence of those press releases, we're left with yet another "free and legal" P2P company with no network to call home. The longer the wait, the longer people will have to ask themselves why use Qtrax's implementation of Gnutella when Gnutella already exists.


This story is filed in these Slyck News categories
Entertainment Industry :: Other
Authorized P2P :: Commercial P2P Clients

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