joegratz.net

Reuters has this report on the blanket refusal of record companies to work with P2P software makers to monetize the P2P user base.

This is an issue that came up, not surprisingly, in the Alterantive Compensation Systems panel I moderated at the Future of Music Coalition Policy Summit this year. Adam Eisgrau, a lobbyist for Morpheus and Streamcast, asked the content industires to join with his clients to move toward a licensing deal. It now appears that his frustration with the industry’s reticence had specific causes — numerous deals, it appears, between content providers, service providers, and P2P software makers that were stopped in the face of threats from the big record companies.

The record companies do appear to be shooting themselves in the foot here. The only way to get people to move to paid services will be to partner and integrate with the free services. If Rhapsody came with each Morpheus download (as it would now if the RIAA hadn’t halted the deal), the transition between P2P and paid would be moving faster than it is now.

The record companies have an understandable reticence to sleep with the enemy, and they may be worried about waiver problems (or just looking bad) if they make deals that cause them to profit from the infringement of their own copyrights. But the transition to paid online services would be speedier — and everyone would be happier — if the companies could get over their grudges and look at the bottom line.