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Music industry discovers the value of free

In a time where the most common activity in the music industry is recognizing and stopping piracy, a new player comes to the table with a bold new concept. Free.

In a time where the most common activity in the music industry is recognizing and stopping piracy, a new player comes to the table with a bold new concept. Free.

This is a new and abrupt change for a business that has been desperately fighting against a steady erosion in overall sales of recorded music. 2007 saw an estimated 10% decline over the slumped sales of 2006 to reach an anemic total of $17.6 billion globally. This is compared to a healthy $38 billion in 1998.

In the midst of demands for free music, a new player has arrived on the scene.

Qtrax made its debut on Jan. 27, complete with rap stars and invitation-only concerts. It defines itself as "the world's first free and legal peer-to-peer music service." The catch is that the tracks, while legal, will have some form of restriction that limit their usefulness to the consumer.

From the International Herald Tribune:

Outside of the Apple ecosystem of digital music, which ties purchased songs to its brand of player, the choice for consumers seems to be coming down to music that is free of monetary cost but restricted, or music for a set price that can be played on any device.

A year ago, many in the record business were dismissive and downright suspicious of letting their music loose on the Web in the plain-vanilla MP3 format without being controlled by a set of digital locks and keys, known as digital rights management, or DRM.

But in just the past seven months, all four of the major recording companies have agreed to allow DRM-free licensing of their catalogs of music. Earlier this month, Amazon MP3, the online retailer's new music store, signed up Sony BMG's unrestricted catalog, with individual tracks for sale at 89 cents each.

While this is a change in the industry stance until now, there are still questions. Qtrax will not disclose details about the DRM that accompanies each track. Furthermore, the songs will not be portable until Feb. 29, Mac-compatible until mid-March, or playable on an iPod until April 15.

Still, for its shortcomings at the near term, the industry seems to be solidly behind the Qtrax effort. It allows them the opportunity to do what file sharing has been doing for some time — examine the business model of free music and potentially move to a model that's more open than iTunes.

What do you think that the impact of free, downloadable music will be? Or will you still not touch it because of the DRM payload?

More information:

Qtrax aims to offer iPod-friendly tracks (MSNBC)

The music industry appears to see sense! (Geek News Central)

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