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P2P: Boon or Bogeyman
by Mike Grebb.

This article first appeared in The Musician's Atlas' January 2005 Atlas Plugged Newsletter and is used by permission. The Musician's Atlas is a fantastic resource for musicians, containing over 30,000 music business contacts.

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Once upon a time, the band Ten Mile Tide was living a fun but relatively low-key existence playing local clubs in the San Francisco area (save an occasional mini-tour here and there). Money was tight, so none of the six band members dared quit their day jobs, which ranged from molecular biology to the culinary arts. One guy was even a music journalist by day (talk about a bad gig… geez).

But by the summer of 2003, something happened. Their fan base exploded, allowing band members to quit the day jobs and go out on the road full time. Since then, the band has sold nearly 6,000 song downloads over the Internet and some 10,000 CDs through all channels. They now each collect a good salary from the band and just bought a tour bus. Their music, which their Web site describes as "a smooth blend of feel-good acoustic rock, foot-stomping folk, and beer-drenched bluegrass," is now a full-time passion and career.

How did they do it? Did a record label sign them? Did a big booking agency or management company decide to take a chance on them? Did the God of Indie Bands bless them with mystical powers? None of the above.

While Ten Mile Tide’s success does involve the usual blend of talent, luck and timing, one fact remains: the band owes its tremendous exposure to a technology that has now swept the Internet and literally rocked the entire entertainment industry to its core. That technology is peer-to-peer networking, aka "P2P". Bottom line? Without P2P, the boys of Ten Mile Tide would still be cranking out tunes in the Bay Area and shackled to their day jobs. "Kazaa is the whole reason we have any national fan base," says Ten Mile Tide’s Marc Mazzoni (keyboards, lead vocals).

Kazaa, in case you don’t know, is one of the most popular P2P software programs. You can download it for free (although it comes loaded with plenty of annoying adware if you do so) or buy the ad-free Kazaa Plus version for about $30. Millions of songs, movies, software and other content (yes, plenty of porn) zips around the Internet every day enabled by Kazaa’s P2P software, and much of that content is copyrighted fare.

Some copyright owners are furious. They see Kazaa and P2P in general as nothing but a system for mass piracy, allowing millions of people around the globe to steal copyrighted material with reckless abandon. And because Kazaa doesn’t have any kind of central server monitoring all of this traffic, it’s practically impossible for affected copyright owners to shut it down. The genie is out of the bottle, as they say.

Of course, while many established artists and labels with catalogs to protect see P2P as a major threat, indie bands and labels looking for exposure have been less willing to dismiss P2P or regard it as evil incarnate.

In the case of Ten Mile Tide, P2P put them on the map. Here’s how: In 2002 the band won recognition as one of the "30 Best Bands" in a joint promotion between Kazaa and the Web site www.cornerband.com, and their downloads began slowly.

Using a tracking software tool provided by Kazaa, the band tracked about 10 song downloads the first week. Not bad. When they checked the next week, about 100 people had downloaded their tunes. Even better. Within a few more weeks, it was in the hundreds of thousands, and the band was in a state of shock. "It basically snowballed exponentially, and it really grew our fan base," says Mazzoni.

Before long, Kazaa’s executives — eager to find an example of how P2P could help rather than hurt the music industry — latched onto Ten Mile Tide's success. Kazaa offered to take out ads about the band in national magazines and help work the press. The band accepted, and Mazzoni says the band now has logged nearly 18 million song downloads through Kazaa. "It’s a mutual kind of thing," says Mazzoni. "They’re using us, and we’re using them."

Here’s the interesting piece of the P2P puzzle: Because all of the band’s songs are available for free download, it would seem logical to assume that many people would bypass actually purchasing the albums. But 10,000 CD sales later, the band is amazed. "It’s crazy how this has caught on," says Mazzoni. "I wouldn’t have thought that downloading would lead people to buy our CDs, but it has. People really want to support the band."

Now for a reality check. Ten Mile Tide’s experience isn’t typical of the thousands of bands whose music is also readily available on Kazaa and the other P2P networks out there. Much of Ten Mile Tide’s recent exposure is clearly the result of Kazaa’s corporate publicity department, which certainly doesn’t do that sort of thing for the many artists whose songs are available through Kazaa.

So why was Ten Mile Tide cherry-picked by Kazaa's gatekeepers? As in any business, it comes down to the numbers. In this case, Kazaa's choice mirrors the current major label model - putting their resources behind an act that has already built up a sizeable fan base. For as Mazzoni is quick to point out, the band had already logged about one million P2P downloads before Kazaa corporate came calling.

But as the music industry wrings its hands over P2P, the question arises: What if record labels or even indie artists did these kind of promotional deals with Kazaa and other P2P companies all the time? Would CD sales rise rather than fall? Would concert attendance go up? As the VCR spurred a multi-billion-dollar video rental business, could P2P offer the same potential for the music industry? No one knows the answers to these questions, of course, but recent events suggest that both sides are at least talking.

Recent deals between record companies and companies such as SnoCap, which offers P2P-friendly digital rights management, and Wurld Media, which wants to start an industry-sanctioned P2P network, could finally "legitimize" P2P. But it’s unclear whether consumers will bite.

P2P has become so big that even the government has gotten involved. In December, the Federal Trade Commission hosted a workshop on P2P technologies at its Washington, D.C., conference center. The event attracted representatives from the record and movie industries, as well as several executives and advocates for P2P technologies. A number of academics also showed up to present studies on how P2P affects record sales (not surprisingly, the studies disagree over whether P2P has had a directly negative effect).

At the FTC event, several executives at P2P companies were on hand to battle with industry reps—even as they tried to find common ground. Sam Yagan, president of the popular eDonkey P2P company, showed up even though the Motion Picture Association of America had only a day before the conference targeted eDonkey users in a lawsuit against several P2P services. Yagan, however, held up a CD by the band Bishop Allen, which he said rose to the number-two spot on Amazon.com after eDonkey helped promote it among its users. "A lot of people say you can’t compete with free," he told attendees. "These guys would tell you otherwise."

And in an unusual twist for a stuffy Washington conference, songwriter Wood Newton of the Nashville Songwriters Association International actually serenaded the crowd with a song about… what else?… Copyright. Newton, who has helped write songs for greats such as the Oak Ridge Boys and Kenny Rogers, had a decidedly different take on P2P networks. While "excited" about P2P technologies and their potential, he said the current trading of copyrighted works without permission threatens the livelihood of thousands of songwriters who depend on royalty checks. After all, these are folks who have already paid their dues under the old system that existed before the Web changed everything. They aren’t looking for more exposure; they’re just looking to eat. Meanwhile, artist-supported site www.whatsthedownload.com tries to educate consumers about "the value of paying for music" and how many people depend on those revenue streams to survive.

Perhaps that, more than anything, is the central conundrum. For every Ten Mile Tide and Bishop Allen, there are no doubt thousands of people in the music industry whose lives and income streams have been turned upside down by the rise of P2P networks. It’s a time of great uncertainty. But it’s also a time of great opportunity. There’s no reason why the traditional music industry can’t work out ways to harness rather than squash P2P. And there’s also no reason why P2P software companies, which are interested in making money and staying in business (rather than defending against lawsuits and risking corporate liability), can’t acknowledge that they bear at least some responsibility for the actions of their users.

After all, putting all the for-profit P2P companies out of business may only add strength to underground networks such as BitTorrent, which programmer Bram Cohen created for fun, not profit. "What’s more frightening are these rogue anarchists," Yagan told attendees. Someday, the music industry may yearn for the day when the original Napster’s central servers controlled most of the download traffic. Back then, the industry might have nipped the entire P2P movement in the bud with one sweeping deal that legitimized file sharing. Instead, they sued Napster out of business (the new Napster is simply a pay-per-download site like iTunes) and gave rise to harder-to-stop P2P services.

The genie it seems, isn’t just out of the bottle. He’s dancing on the graves of the old music business. And he’s looking for partners.


(Mike Grebb is a writer, journalist and singer/songwriter based in Washington, D.C. He has written for numerous publications, including Wired and Billboard. He just completed his debut solo record, Resolution, which is available at www.mikegrebb.com).

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