Ind-E-Focus

Record labels report millions of dollars worth of losses per year due illegal downloads and piracy, but a new website aims to put an end to the piracy business, Murad Ahmed of the Times Online explains;

The new free streaming service wants to re-define our relationship with music by forging unlikely alliances in the business

The days of paying for music over the internet — or illegally downloading free tracks — are numbered, according to artists, music companies and leading industry insiders.

The reason given for this is the rapidly growing popularity of Spotify, a music service that “streams” tracks to your computer. All the major record labels have signed up to allow users to access millions of tracks — from Michael Jackson to Lily Allen, U2 or Shostakovich — free of charge at the touch of a button.

Spotify’s catalogue is fast approaching the size of Apple’s iTunes, the world’s biggest online music service, leading many to question whether the dominance of the digital music market by iTunes is set to end.

“We think that music has gone from being about ownership to being about access,” Daniel Ek, chief executive and founder of Spotify, said. “I have established that. People listen to more music than ever from a bigger diversity of artists. They don’t care so much anymore about actually owning physical CDs, or even downloading, they care about being able to access whatever they want, whenever they want it, wherever they are.”

Music artists told The Times that they welcomed the service because it was a legal and easy way for fans to listen to their music without resorting to piracy. “Piracy is never a good thing, but for too long we’ve tried to stop it rather than recognise that it happens and then find a way to deal with it,” Jamie Cullum, the award-winning jazz-pop artist, said. “You can’t prosecute a 12-year-old boy for illegally downloading a record. You just have to make it easier for him not to.”

He said that artists had accepted that listeners expected to hear music free first, and this gave musicians the exposure needed for the public to buy their work or to see them live.

Not everyone is happy with Spotify’s growing influence, however. Dan O’Neill, manager of the dance band Groove Armada, said he liked the service but was concerned that it gave too much power to record labels and deprived musicians of royalties.

Spotify has four million tracks and is expanding rapidly, adding some 10,000 tracks a day. Last week it announced a major deal with Naxos, the largest classical label, which will give users access to more than 100,000 tracks, including music by Mozart and Rachmaninov.

“What really impresses me about Spotify is that they view piracy as their biggest competitor,” said Will Page, chief economist at PRS for Music, the organisation responsible for collecting royalties. “That matters because the black market is so much bigger than the legal one.”

Music companies have been struggling to deal with the impact of illegal piracy on dwindling music sales. Some question whether Spotify’s business model, which relies on advertising, will provide strong enough revenues in the long term. Mr Ek said that the company expected to be profitable by the end of the year, and its advertisements were successful because they could be targeted to individuals.

LISTENERS GUIDE

Services such as Spotify and Last.fm stream music direct to your computer, offering free access to millions of tracks. Spotify works by paying record labels to host their music catalogues

A stereo or CD player is no longer required — just speakers connected to the computer

Users hear a 15-second advert every half hour. Music without adverts is available for a £9.99 subscription

Users do not own the music, so it cannot be transferred to portable players such as iPods (Source: Times Online: Music labels fight pirates through Spotify by Murad Ahmed, Technology Reporter, and Alexi Mostrous)