Key Of Grey

November 5th, 2008 – A couple days ago, I stumbled across Grooveshark. It’s a music distribution website with great social networking functionality and what looks to be a fairly robust backbone under a slick UI. What really caught my attention was that it is based upon P2P downloading and claims to pay both the owner of the song, and the uploader.

These claims immediately intrigued me; could Grooveshark have succeeded in gaining major label support where so many other P2P-based software had failed? Well, yes and no, which ultimately means no (perhaps Grooveshark would like to clear it up if my understanding is incorrect). According to CNet, Grooveshark has major backing from all the American organizations responsible for collecting songwriting royalties. Nowhere, however, did I see any information about major record companies that had signed on with their catalogues. As I’ve explained before, there are two owners of any song you buy on CD or digitally: the songwriter and the owner of the recording. These may be one person in indie situations, but in major label situations this always means separate organizations.

The organizations that Grooveshark has agreements with, are for the songwriters. The labels have a much tighter hold over ownership of that specific recorded version of a song. You cannot sell or use those recordings without the labels’ consent. This has been the main failure point of previous P2P networks, and why I’m concerned that Grooveshark might not succeed. They are a real company with actual capital so I assume they have a lawyer that specializes in music law to consult with. Perhaps I don’t have the whole story, but the lack of major label announcements tells me that they don’t yet have that support.

Ok, negativity aside, I really like Grooveshark’s ideas about its users and uploading pirated songs. Grooveshark is going to reward the uploader everytime his song gets downloaded. The user may get rewarded in credit to buy more songs, concert tickets, or merch. What’s truly revolutionary about Grooveshark’s thinking, however, is that they don’t care where the uploader gets the song. This means that the song might be have come from an illegal source, but by re-entering it into the Grooveshark network, it re-legitimizes the song because people pay to download it. That idea is a pure stroke of genius and why I’m still clinging onto hope that GrooveShark is able to gain major label support and thrive.

Here’s an article from ZeroPaid where the author interviews Grooveshark’s Michael Vroegop.

GrooveShark