Qtrax To Offer Music File-Sharing With OK From Labels
June 25, 2007 at 5:40 AM (PT)
Music file-sharing service QTRAX is about to hit the markets with the blessing -- not to mention the catalogs -- of all four major record labels, PETER LAURIA writes in THE NEW YORK POST. In a deal expected to be announced today, parent company BRILLIANT TECHNOLOGIES plans to spin out QTRAX and merge it with an entity called FLOORING ZONE, which will serve as a shell company so that the file-sharing service can be traded publicly.
After the deal, shareholders in BRILLIANT TECHNOLOGIES will own 80% of the new company and 20% will reside in public hands.
QTRAX's market debut -- a first for a file-sharing service -- follows plans by DOWNTOWN RECORDS and Internet entrepreneur PETER ROJAS to launch an online-only record label that will offer its music for free and generate revenue only through advertising and sponsorships.
With a full complement of songs from the major labels as well as the esoteric live recordings and personal tracks stemming from users' own collections, QTRAX will have access to between 20 million and 30 million copyrighted songs at launch in OCTOBER, BRILLIANT TECHNOLOGIES CEO ALLAN KLEPFISZ estimates.
At that size the service could not only be considered a legitimate threat to APPLE's ITUNES, which only features 5 million songs, but also a better economic proposition as well (record labels collect about 70 cents on each ITUNES sale). QTRAX's initial revenue projections range from a low of $20 million to a high of $175 million. Record labels will get an equal split of advertising revenue in addition to the royalty fees it collects from QTRAX.