Legal file-sharing service touts free music with ads

Sun Jan 27, 2008 12:20am EST
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By Yinka Adegoke

NEW YORK (Reuters) - Qtrax, a new legal online file-sharing service that allows fans to download songs for free, said on Sunday it will launch with 25 million to 30 million copyrighted tracks with backing from major labels.

The free service will be funded through advertising revenue that Qtrax will share with the music companies.

Qtrax executives said the company's digital rights management technology will count the number of times each song has been played in order to fairly compensate artists and rights' holders, without restricting consumer use.

The company has focused on ensuring that its network is free of spyware or adware such as pop-ups common on many peer-to-peer networks to improve the customer experience.

"If you want people to come to a legal environment it has to be demonstrably better," said Chief Executive Allan Klepfisz.

Peer-to-peer services, which allow fans to exchange digital media files quickly and easily, have been controversial for media companies because the technology enables illegal distribution of copyrighted material.

Music companies have been badly hit as fans flocked to P2P services like Limewire and e-Donkey to download millions of free songs rather than buy CDs or legal downloads from Apple Inc.'s iTunes digital store.

The music trade organizations have used litigation with varying degrees of success to try and close down P2P services they argue are promoting piracy.   Continued...