Comments on: Lessons from Social.fm

When I spoke to a Mercora founder a couple years ago, I didn't understand the start-up's vision and business model. Lack of clarity may have been its fatal flaw.

[luckybleu]

You feel burned by Qtrax? They have been fighting with the majors for years to offer FREE LEGAL music and now Its all coming together.Whens the last time you logged on to qtrax? Obviously you havent lately because the music is flowing Major label downloads ,they are continually upgrading the site with new music daily. It takes alot of hard work to change the thinking of an industry so set in their ways but QTrax has done it and continuing to do so once they add portability to mp3 players and are global they will be one of the most popular music services out there. Dont feel burned ,embrace qtrax for what it has already accomplished and for what is to come.

[themusicskeptic01]

If I may, I'd like to point out some things about QTRAX:

1. The author of the article was referring to the failed launch of QTRAX back in January 2008. If you may recall, the service claimed to have the backing of the four major record labels when, in fact, no such licensing agreements existed. As a result, I can understand how the author might feel burned by QTRAX.

2. QTRAX had initially promised a compatible application for Macintosh users to launch sometime back in March 2008 I believe. This application never came to fruition and the promise has since been removed from their site. Similar to SpiralFrog, I believe that such an application was never a possibility from the start, since it uses a proprietary Windows Digital Rights Management scheme to protect the ad-supported songs. As such, the Windows DRM is not compatible with the Mac.

3. Furthermore, since Windows DRM is used, if QTRAX decides to allow songs to be transferred to digital audio players, the only supported players are those branded with Microsoft's PlaysForSure logo. As such, these songs are neither compatible with the market-leading iPod from Apple or with Microsoft's own Zune. As such, the songs are only portable to a very small percentage of the market.

4. Thus, as it stands, QTRAX and SpiralFrog will probably only ever cater to a rather small group of users. As such, I don't see how either can ever become a sustainable business beyond a few years, without some sort of mind-blowing innovation or a complete ideological shift in the thinking of the record labels. Therefore, I would not be surprised if QTRAX and SpiralFrog end up either merging to reduce costs or end up both closing down.

Apple has successfully proven with iTunes that people are willing to pay for music downloads, and I don't see their market dominance waning anytime soon either. If a service like QTRAX had been on the scene before iTunes, I strongly believe the digital audio marketplace would be vastly different today and my outlook on ad-supported music services would be vastly different as well.

As a result, I wouldn't be surprised to see QTRAX and SpiralFrog in the next few years join the list of other defunct music services: MusicMatch, Mercora/Social.fm, SonyConnect, MSN Music, MTV Urge, etc.

[luckybleu]

As you stated I tunes is a very popular PAY service but accounts for only about 6% of all music downloaded in the U.S. the rest of downloaded music comes from illegal file sharing networks That leaves a huge market for qtrax to tap into.With isp's cracking down on illegal file sharing and lawsuits by the riaaa aimed at individuals who practice this Qtrax will be a welcomed alternative to alot of people who want to be legal and avoid possible prosecution .They have a mechanism in place to allow access to music available on p2p networks so called grey tracks ,that no music service has rights to (see EMI press release concerning qtrax) this will give them a catalog that dwarfs I tunes and all other legal sites.Also qtrax will be global which will give them the # of users to support the business model , and the i pod is only really popular in the U.S. not in europe so that wont be an issue . With isp's in the U.K. now sending out warning letters to people who download music illegally this should turn alot of people away from illegal sites and right to qtrax.

[themusicskeptic01]

I agree the majority of downloaded music in the US comes from illegal file sharing networks. The main reasons are it's free, no digital rights restrictions, and portability to all digital mediums. Here in lies the problem with QTRAX.

While QTRAX offers free music, there are digital rights restrictions on the music files and as such, they are locked to a specific set of devices -- Microsoft PlaysForSure devices. Thus, the music cannot be synced with either Apple's widely popular iPod, which has a 67% market share in the US and a 25% market share in Europe, nor Microsoft's own Zune. In addition, due to the DRM, the music cannot be format shifted either. Thus, the music cannot be burned to a CD nor converted into mp3s which can be synced with all devices.

As such, I feel QTRAX will have a very difficult time converting those individuals. In spite of the introduction of the DMCA in the US and the RIAA's continued lawsuits, there has been no effect on the amount of illegal file sharing taking place.

Lastly, while QTRAX aims to offer music available on p2p networks, I believe none of the labels have agreed to allow this. Furthermore, the majority of tracks available on those networks are either mislabeled, of poor sound quality, or infested with viruses.

QTRAX certainly has an interesting idea on paper; however, its actual viability in today's marketplace remains very much in doubt.