Business News Digital Labels & Publishers

Qtrax is back, and this time it’ll fix piracy and artist royalty gripes

By | Published on Tuesday 17 February 2015


The last time we saw Qtrax in these parts, it was busy telling us that it had finally secured deals with three of the four major labels (which dates that story somewhat), three years after a glossy launch at MIDEM full of bold promises about revolutionising the digital music market, only for it to transpire none of the big music companies were as yet on board.

The ad-funded DRM-heavy ‘legit file-sharing network’ did eventually go live in some countries after its false launch in 2008, though – even when some labels did start to play ball – that failed to compensate for the slight hitch in that the service was shit. And by 2011 – as a plethora of ad-funded streaming services started to gain momentum – entirely unnecessary.

But now Qtrax is back, as an, erm, ad-funded streaming service. Because heaven knows, we need more of them in 2015. Though, to be fair to the showmen behind the start-up, they have found a timely USP. Aware that artists and songwriters have been very busy bitching about being short-changed by the streaming sector (or, more to the point, by the labels who get the biggest share of Spotify cash), Qtrax v2 will be the artist-friendly streaming service.

30% of equity in the company is being set aside for an Artists Trust, while 10% of royalties will be paid directly to artists and songwriters whose content is available on the service. Quite how that will all work isn’t yet clear, but Qtrax boss Allan Klepfisz reckons that, this time, he’s really onto something.

He told The Telegraph: “There is something very wrong with the current model. The current economic structure is not likely to ever compensate the artist… But it’s not that difficult for a paradigm shift to occur. Traditionally the record companies get equity in digital services, but no one has asked on behalf of the artists. This could become a de facto way of doing business”.

Klepfisz still reckons that ad-funded freemium is the way to go for a digital music service to go truly mass-market, and he remains keen on turning those people still pirating tracks online into legit music consumers (an ambition, of course, that is frequently cited by Spotify too). Noting that griping artists and songwriters gripe most about freemium, he hopes that specifically sweetening the deal for them will overcome concerns.

But of course – self-releasing artists aside – Qtrax will still need to woo the labels and publishers, and it seems unlikely they’d be willing to forego any of their royalty splits or equity shares, meaning the artist sweeteners would have to come from the digital service’s own cut of company and revenue. And given how tight the margins are on a streaming service, especially an ad-funded one, that’s going to be a tall order.

But look at me, Mr Doom And Gloom. I mean, as Klepfisz points out, Facebook’s been rather successful hasn’t it, so why not Qtrax? Ha, I bet you all feel foolish now, don’t you?