Qtrax: How not to launch a product

This one could go down as one of the most bungled launches in Web 2.0 history — and that’s saying a lot. Qtrax, the legal ad-supported p2p network that has been in the works for more than four years now, came out on Sunday with much fanfare at the Midem music industry conference in Cannes, and said that it had the backing of all four major record labels, and would launch with 25 million tracks available for download. And then the wheels started to come off.

First, Silicon Alley Insider quoted a spokesman for Warner Music as saying the label had no agreement with Qtrax; then a spokesman for Universal said that they didn’t either; then someone at EMI said that it had no such deal either. Finally, a spokesman for Sony BMG said it had not signed anything with Qtrax either. So from being “the first legal p2p network backed by all four labels,” Qtrax quickly became a p2p network without official backing from any of the major labels.

The company says that this is all just a misunderstanding, and that it is close to finalizing deals with all the majors — but that’s not what its press releases and comments implied on Sunday. They said the service would be launching on Monday with 25 million tracks and the support of all the labels. That led to glowing articles like this one in many publications about the launch of this incredible network.

According to a report in Wired magazine, Qtrax had agreements several years ago with the major labels to do trials of an ad-supported music service, but most of those deals have since expired, and the kind of network the company is currently talking about is different from that described in the original agreements.

In addition to the “misunderstandings” with the labels over whether they support the idea or not, Qtrax has apparently been unable to start even a limited version of the service as promised. The site was unavailable off and on Monday, and said that as a result of demand the launch would occur “in stages.” A download link on the launch page was disabled. If Qtrax can somehow survive this botched launch and actually become a useful alternative, it will be the equivalent of Lazarus rising from the dead and then getting his own prime-time TV show.

Qtrax: Can ad-supported p2p work?


Matt posted a comment here with a link to Silicon Alley Insider, which notes that a Warner Music rep says the label has not licensed its music to Qtrax, and Universal hasn’t signed a deal either but is reportedly talking to the company. Sounds like even more reasons to be skeptical.

Original post:

Qtrax finally launched on the weekend at the Midem music conference in Cannes — although the service is currently down, with a page telling users it is unavailable “due to overwhelming demand” and to return in 24 hours. The service, which used to be a Kazaa-style p2p app, has spent the past four or five years now trying to become what it claims is the first legal peer-to-peer music service.

There are more than a few reasons to be skeptical about its chances. One is that Qtrax has already missed several launch dates, most recently in October. And while Wired magazine says that the company has more than 25 million tracks, other reports say that includes all the songs available on Limewire and other p2p networks, and it’s not clear how many of those will actually be available to Qtrax users.

The fact that it has taken this long for the service to even launch is a sign of how hard it is to build a business that suits the demands of the record industry and the needs of users. It’s also not clear whether the company’s business model – music paid for by advertising – will even work or not. Several other companies, including SpiralFrog.com, are looking to do the same thing, but have yet to show much success (several SpiralFrog executives left last year). Note: See the comment from Brian below for a link to some numbers about SpiralFrog.

While the songs are free, you have to use the Qtrax music player software — a specialized version of the Songbird music browser, which is itself based on Firefox — in order to play them, so that the browser can show you the ads that are supposed to pay for everything. In other words, no iTunes. And while the company says it is working on iPod support, at the moment it appears that Qtrax files won’t play on iPods.

It’s bad enough that the files include digital-rights controls that prevent them from being burned to CD. If they won’t play on the world’s most popular music device, that would be a killer. Meanwhile, Amazon says it is rolling out its giant music service internationally — and it is completely DRM free. Will users prefer DRM-free music that costs money, or free music that comes with all kinds of restrictions?

Pirate Bay is Napster times ten

TorrentFreak has the news that The Pirate Bay has passed a somewhat amazing landmark: 10 million “peers,” or individual BitTorrent servers that are indexed by the site’s “tracker.” Although it’s not directly comparable to The Pirate Bay because of the way that BitTorrent works, I started wondering how those numbers stacked up against Napster, the first widespread peer-to-peer file-sharing app.

According to a retrospective from former Napster vice-president Don Dodge, the network at its peak had more than 50 million registered users. But those were just people who signed up, and may have only used the service once or twice. How many simultaneous users did it have at its peak? According to several articles I found, the file-sharing network topped out at about 1.6 million simultaneous users.

(I know that 10 million isn’t quite ten times 1.6 million, but TorrentFreak notes that the number of peers tracked by The Pirate Bay jumped from 8 million to 10 million in a month, so I think it’s likely that the service will be tracking 15 million peers or so fairly soon).

Anyway, you look at it — and Slyck has a bunch of things to compare it to, including the entire population of New York and then some — that is a gigantic number. Does that mean millions and millions of people have suddenly decided to renounce morality and become dirty, thieving pirates? I don’t think so. I think that media industries of all kinds are dealing with what author Matt Mason calls The Pirate’s Dilemma.

In other words, The Pirate Bay is a gigantic, flashing sign pointed at the entertainment industry as a whole, and in a nutshell what it is saying is: you need to change. Not soon — now.

Facebook wants to be the Web OS

AllFacebook is reporting that Facebook has now made it even easier for developers to create Facebook apps and widgets that will run just about anywhere on the Web. According to the description at ZDNet, developers have been able to get Facebook widgets to run elsewhere since the platform launched, but it took some server-side scripting and knowledge. Now apparently all it takes is a little bit of Javascript.

Whether you think this is a good thing or not probably depends a lot on your view of Facebook widgets and apps, but what I find interesting is how Facebook is trying to straddle the line between control and the open Web — to find some middle ground between the “walled garden” approach and the totally open. The site would no doubt really like it if everyone who created an app used it only on the site, and every user of that app had to come to the site to use it. At the same time, however, Zuckerberg and his team have to recognize that’s probably not going to happen.

Can Facebook continue to be a kind of gatekeeper of the social graph, and yet still allow bits and pieces of its platform to live elsewhere on the Web? I think the fact that it is even trying to do so is worth noting — even though it seems like the site is trying to have its cake and eat it too.

Pay for a blog feed? Not going to happen

Allen Stern of Centernetworks has a provocative post in which he asks whether people would be willing to pay $1 for a full-text RSS feed, or to pay $4.95 for a bundle of 10 feeds, etc. His point (I’m pretty sure) is that advertising in RSS feeds doesn’t really work that well, and that it’s hard to monetize a blog if no one ever comes to the website and looks at the feeds. Allen has very kindly suggested that my feed could be part of the tech-blog “bundle,” but I don’t think his idea is going to work.

Many of the commenters on Allen’s blog argue that this would be good value, that full feeds without ads would be better than either partial feeds or feeds with advertising, and so on. MG Siegler at ParisLemon says that he thought the idea was ridiculous at first, but that he has warmed up to it. I’ve given it some time and thought about it a fair bit, but I’m not warming up to it at all. If anything, I’m getting colder towards the idea. I just don’t think making people pay for feeds makes any sense.

If any of the blogs that Allen has in mind were producing content that was highly valuable — inside information, valuable tips — then you might be able to argue that charging for them would make sense. But I can only think of a few blogs that fall into that category (and no, I’m not including my own), and here’s the thing: most of them are already making money from those things, just not through their blogs. As Rex Hammock said, my blog doesn’t carry advertising, my blog is advertising.

I can totally understand the desire for something like a paid-feed model — I just don’t think it would work, and it kind of goes against what I see as the whole point of having a blog. Sorry Allen.

Media: Still grasping for a clue

We can all debate the wisdom of the Wall Street Journal maintaining a pay wall (or at least part of one — see my recent post), and even the wisdom of newspapers and media sites having registration walls. But surely we’ve gotten beyond the point where anyone would argue that publications should try to control where and how you link to them, right? Wrong. According to a post by Don McAskill, CEO of image-sharing site SmugMug, BusinessWeek specifically asked him not to link directly to a recent article they wrote about his company.

When I first read that, I confess that my jaw dropped open in amazement. Did I go through a time warp of some kind that put me back in the mid-1990s? No. But reading through BusinessWeek’s bizarre and long-winded “user agreement” is like going back a decade or more, to a time when traditional media — and companies of all kinds — thought they could control how users accessed or made use of the material on their websites, right down to preventing them from linking to certain things.

In fact, if you read through the part of the policy that covers “deep-linking,” which is made to sound like something heinous and clearly illegal, it also forbids “bots” from going through the site, which would seem to cover what Google and pretty much every other search engine on earth does. That’s smart. Don’t just try to block people from linking to your articles — try to prevent them from ever being found at all! Brilliant. (The BusinessWeek article is here, in case you want to read it).

Don also writes about how a story the L.A. Times wrote about SmugMug isn’t available easily either, because of the site’s registration wall. I know I’ve been stopped short before by the Times wall (check the comment at that link — the registration wall pops up after a certain number of visits), and each time I go away and never read the article that has been linked to. I know I could just use BugMeNot, but I just can’t be bothered, and so the story goes unread. How is that doing anyone any good? That’s pretty dumb — but BusinessWeek takes the cake.

Warner: When in doubt, sue someone

Fred von Lohmann of the Electronic Frontier Foundation has the details on a lawsuit that Warner Music has launched against Seeqpod, a music search engine that has become popular over the past few months — largely because it is super-fast, and allows users to play songs directly in their browser after they find them. Songza.com is another similar music-search engine, although the user interface is much more stripped down (it was developed by Aza Raskin, the 24-year-old son of legendary Apple designer Jef Raskin), and it recently announced a deal with Seeqpod.

As Fred notes in his post, this lawsuit is just the latest attempt by the music and content industries to go after anything that functions as a search engine, on the argument that if they allow people to search for copyright-infringing files then they are contributing to that copyright infringement (which was the central point of the Napster and Grokster cases). What makes Seeqpod.com and Songza a little different is that they actually allow you to play the file, even though it resides somewhere else.

It will be interesting to see where this one goes, if only because it has implications not just for search engines but also for other music-related services, such as the Yahoo Music built-in mp3 player the company launched not long ago — part of Yahoo exec Ian Rogers’ vision of a distributed music network that finds content wherever it is and makes it playable. There are other services as well, including G2p.org, that let you find music easily (and I just found another one about 10 minutes ago called FindTheTunes.com). Can the record industry stop them all?

Facebook: The startup sandbox

I think it’s a bit much to be calling Facebook’s platform the “new social operating system,” but then I guess when your blog is called Knowledge@Wharton you kind of have to pump things up a bit. What I do think has been happening is that more and more companies are treating it as a kind of sandbox for ideas — a place to try out a small feature or even a full-fledged app, to see whether there’s enough response to make it an actual business, or to seed an actual business.

You can see this happening with all kinds of different companies: Alec Saunders is doing a kind of online podcast/conference call to publicize the free-conference-calling app that he and his team at Iotum in Ottawa have put together; my new friend David Gratton from Project Opus in Vancouver has an app called MixxMaker that is a kind of proof-of-concept for a music-sharing technology; and along the same lines, Ian Andrew Bell of Something Simpler in Vancouver recently told me about his app, Pul.se, which is a kind of recommendation engine.

I’m sure there are dozens, if not hundreds, of other examples. As more than one person has pointed out, however, getting so firmly attached to the Facebook economy can be a Catch-22: you start your app there in order to experiment and gain users, but then once you gain enough to make it worthwhile, you are stuck fast to Facebook and it’s hard to end a symbiotic relationship like that. Companies such as iLike eventually decided to hitch their wagon entirely to Facebook and de-emphasize the standalone service. But is that a wise decision?


Pema Hagen, a co-founder of GigPark, mentions in the comments here that they just launched their Facebook app last night. GigPark is a social recommendation engine for goods and services. And this news could make developing apps for Facebook even more appealing: the site is apparently making the F8 platform part of its API, so apps could theoretically be made to run anywhere.

Journalism: of sell-outs and hand-outs

Is this really the best we can do for a Friday frenzy on Techmeme? Scoble decides to put ads on his blog — woop-de-frickin-doo. If someone wants to advertise on the Scobleizer’s blog, they can go right ahead. I certainly don’t think it’s going to affect anyone’s perceptions of whether what Robert does is actual journalism or not. Or maybe Scoble and other bloggers should receive some kind of government support, like the tall foreheads at Davos were apparently discussing when Mike Arrington was there.

Is the practice of journalism in danger? Hardly. If anything, there’s more of it going on all the time, depending on how you define the term (and no, I’m not including Digg). Sure the newspaper — and I emphasize the term *paper* — business might be having a rough time, although plenty of people have pointed out that Sam Zell and Rupert Murdoch seem to see the newspaper business as pretty appealing, even if they are probably going to fire a whole bunch of people in the process.

Columbia Journalism School dean Nick Leman makes a half-hearted case for government support of the media in a response to Forbes magazine’s piece from Davos, noting that the BBC is government funded (with the money coming from a TV tax), and that PBS and other public media play a role. But it’s one thing to point to the BBC and PBS as a success — which some might argue with — and another to argue that the government should actively get into financing the journalism business.

If people want long-form, investigative journalism then I assume they will indicate that desire in the traditional way: by reading it, and in some cases even paying for it. The idea that government support is required because some newspapers aren’t making 30-per-cent returns on invested capital the way they used to is ridiculous.

Fred is right and Rupert is wrong

As the Wall Street Journal is breathlessly reporting, Rupert “Just Try and Stop Me” Murdoch has apparently relented on his much-discussed plans to open up the Journal’s content and get rid of the paywall, and will be keeping some subscription products (and boosting the price for them, oddly enough) while letting more stuff move outside the wall. In other words, he will be trying to have his cake and eat it too.

I know that there are a lot of smart people out there who believe that you can do both — one of them being Rex Hammock, who has been predicting for some time that Rupert would see the light and go for a mixed strategy. I would not claim to have the expertise in publishing that Rex has, but I do know one thing: the kind of content that newspapers produce, in virtually all cases including the esteemed WSJ, is either a commodity (in which case charging for it is nonsensical) or something with added value. In both cases I think it benefits the paper to release it into the wild.

Obviously if it’s a commodity then it should be free. But I would argue that it’s almost more important for the added-value content to be free as well. And here I am in violent agreement with Fred Wilson of A VC, who says that he believes Rupert has made a big mistake by keeping content locked up. As he puts it in his post on the topic:

“Here’s the deal. Digital media is not about scarcity and never will be. That’s the old media game. Online it’s about ubiquity, about being part of the conversation, about links, authority, page rank, and if you are a news organization like the WSJ – its about anchoring the discussion.”

This is the same debate that the New York Times went through, and it eventually decided to get rid of the wall. Was it not making money? No, it was making plenty of money — but that pie wasn’t growing. And it certainly wasn’t growing as quickly as the NYT’s traffic has been since it removed the wall. I think the Journal would be wise to trade the bird it has in its hand for two or three (or twelve) in the bush.