Music industry weighs giving away songs

On Sunday, Klepfisz admitted discussions with the labels were not easy.

"A colonoscopy is relatively painless in comparison," he told participants.

Qtrax, which had claimed it had backing from all the major record labels, is expected to issue a statement later Monday.

The New York-based service was among several peer-to-peer file-sharing applications that emerged following the shutdown of Napster, the pioneer service that enabled millions to illegally copy songs stored in other music fans' computers.

Qtrax shut down after a few months following its 2002 launch to avoid potential legal trouble. The latest version still lets users tap into file-sharing networks to search for music, but downloads come with copy-protection technology known as digital-rights management, or DRM, to prevent users from burning copies to a CD and calculate how to divvy up advertising sales with labels.

Downloads can be stored indefinitely on PCs and — unlike several competing services — be transferred onto portable music players.

The Web site started offering limited service Monday morning, although users will have to wait until Feb. 29 for portability. An "iPod solution" for Apple's popular player won't be available until April 15, Qtrax said.

For an industry that has traditionally relied on paid-for services, advertising was greeted cautiously in Cannes as a replacement for consumers' cash.

"I would like anybody to succeed in this area but there are big challenges," said John Kennedy, CEO of the International Federation of the Phonographic Industry, or IFPI. "I don't see how Qtrax has resolved the challenge of providing adequate revenues."

Steve Purdham, CEO of We7, the ad-funded music download service backed by Peter Gabriel, said advertising is catching on — slowly.

A year ago at Cannes "I was told there was no way any ad-supported model would work," he said.

"The conversations that are going on now are much more open. In the next twelve months, although ad-funded today is economically not really 100 percent viable," it is likely to become "significant" as "an additional model to the industry."

While the record labels' battles against Internet entrepreneurs like Friis may not have won them consumers, the experience may yet help help stamp out piracy.

Scarred by his legal fight with the music industry, which cost Kazaa $115 million, Friis says he has gone straight with his new venture, Joost, which delivers video over the Internet onto PCs under deals with content providers including Viacom, CBS, CNN, the NHL, Sony and others.

"When we started Joost we certainly didn't want another, like, five years of World War Four litigation with the entertainment industry so we were kind of had to choose to do it in a very legitimate way which ultimately is going to be the best business."

MORE FROM GADGETS

Gadgets Section Front

Newsweek: How Apple Turned Into Microsoft FCC plans DTV test in N.C. When sex and technology don't mix Sony recalls laptops for possible overheating Prisons scramble to make digital TV switch Dell may compete with iPhone ... eventually 3G network standards vary by carrier New door locks can be controlled online DirecTV, TiVo to offer new HD DVR Apple's 'Rock' event may unveil new iPods Gadgets Section Front   Add Gadgets headlines to your news reader: