The Constable on August 25th, 2008
Dear Grooveshark:
Are you serious? You’re actually selling songs that you know you don’t have rights to, and just putting the money into a slush fund so you can pay the record labels, etc. when you get the deal done? Seriously?!
recent twitter conversation:
In my experience, if there is one way to kill any chances of going legit, it is to do exactly what you are doing. Your system of posting songs and paying ASCAP / streaming rights is more than likely fine, but to sell content that you know you don’t have rights to is extraordinarily risky.
From the deals I’ve worked on, one thing has stood out - and that is that there are many publishers and labels out there who simply will not work with a business if they have openly violated copyright law.
The simple fact that you have songs from The Beatles available for sale on your service, when not even iTunes has gotten this, is an extraordinarily bad move on your part, if your goal is to be a legal service with actual licenses. It’s one thing to hold royalties if you don’t know if you have rights. That’s debatable, but to hold royalties when you KNOW you don’t have rights….
All I can say is good luck, and I hope you have a good lawyer on retainer.
The Constable on August 25th, 2008
I have to admit, I haven’t had much time to research this site since I just came across it this morning… so consider this more of a note to myself than anything.
A kind of P2P music file sharer / iTunes / social network, Grooveshark.com “is an online music community that rewards you for sharing, reviewing, and discovering new music.” The more music you share, the more credits you get to download music from other people. Beyond this, the built-in social aspect of the site allows people to organize, filter and recommend music for each other - and the most respected users are automatically highlighted so as to give the best experience for casual users.
As for the legal portion… frankly I don’t know how this is set up. At first glance it appears that users can upload anything they want, and then the music is available for sharing or download.
Here’s the info from their one-sheet for the labels:
User Music Experience
- User-generated music bios, reviews, a la Wikipedia
- Demand-based Pricing ($.99, $.75, $.50, $.25)
- Users receive $.25 for every song they sell
- 100% virus-free, high quality files at high speeds
- Massive library via patented p2p architecture
- Custom music recommendations for music discovery
Label Licensing Benefits
- No hard drives or CDs required to upload content
- $.25 user credit incentivizes users to buy more music
- Song recommendations, artist promotion for partners
- Fans are paid to market your artists and bands
- Content is spread virally and legally from fan to fan
Label Content Management
- Full control of pricing, payment, file quality (bitrates)
- Sales reporting and comparison between competitors
- Artist metadata information input and development
- Access fan and user geographic & demographic data
- Full take-down and opt-out of content distribution
Terms
- Revenue split for songs sold in the system:
- 50% - Label
- 25% - Grooveshark User
- 25% - Grooveshark Administration Fee
- • Label provides full metadata information
- • Label pays publishing fees for any content sold
- • Grooveshark pays all PROs related to streaming
- • Grooveshark pays all hosting, integration fees
I haven’t been able to find an option yet for labels to opt out of the system, but I’m not going to say it doesn’t exist. However, I find it hard to believe they are doing this without first gaining approval. If they are simply posting songs, then selling them, and then trying to get contracts, that’s going to be a major problem.
I’ll try to spend some more time on the site later and give a better overview at that time. In the meantime, if anyone has any experience with Grooveshark, please give your opinions in the comments below.
All said, it does look pretty slick. I’m excited to do some research.
