Qtrax Ad-Based P2P Music Service Hits Snag

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Revamped online music service Qtrax turned on its lights at midnight last night, and already they’ve hit a snag: Warner Music Group, Universal, and EMI say it never agreed to be on board.

Qtrax is supposed to combine the breadht of music available via peer-to-peer services like Gnutella and BitTorrent with an ad-supported mechanism which actually compensates artists and labels for users downloading their music. Unlike traditional online music services like iTunes, Qtrax claims to provide access to more than 25 million tracks—and it can make that claim only because it operates essentially has a front end to the Gnutella file sharing network. The vast majority of those tracks have not been licensed for online sale, but Qtrax says it will keep track of everything and work out the details with copyright holders so that everyone gets appropriately compensated for downloads.

Using Qtrax, users can download tracks for free so long as they’re willing to tolerate advertisements. They also have to be willing to tolerate Windows DRM: while the tracks may traverse the Gnutella file-sharing network in unprotected form, Qtrax is wrapping Windows DRM around them and explicitly tracking what its users do with the music, including how many times they listen to a song. Qtrax also says it plans to release a Macintosh client in March, and offer support for the iPod—that probably means the company is working on reverse-engineering Apple FairPlay DRM, which could lead to a technology race with Apple, not to mention legal action.

Qtrax has positioned itself as a label-approved service, but now that QTrax has launched, it seems the major labels aren’t all lined up: Warner Music Group has issued a statement saying the company “has not authorized the use of our content on Qtrax’s recently announced service,” and EMI and Universal have confirmed they have not signed licensing deals with Qtrax. Qtrax says agreements will be reached “shortly.”

Qtrax got its start back in the heady days following Napster’s shutdown over copyright infringement allegations, starting as a peer-to-peer client that offers users access to music files stored on other users’ computers. The service shut down for several months in 2002 to dodge legal action.