Is Muxtape a Sting Operation Against the RIAA?

‘When you play with fire, you’re gonna get burned.’ Two stories, partly connected were in my feed reader (Bloglines if you must know) and the connections have got me thinking.

The first was the rather inevitable legal move by the RIAA on Project Playlist. That site is where users can upload playlists of their songs to share with others and discover people with similar musical tastes. The catch is that these playlists can be played – and if you can see what’s coming up next there’s no way a ‘radio’ licence will cover it.

Certainly in the UK is you can see what’s coming up, you move into the realm of being regarded as a publisher. The US, I suspect, will gun for some sort of $15,000 fine per instance of a track if it gets that far, especially if (as it appears) Project Playlist downloads ‘progressivly’ the file from a third party source and relays it to the listener. Music online is an absolute mess.

Which leads me to today’s Wired’s interview with Justin Oulette, the man behind Muxtap – a serice where you can upload your own MP3 files, have a playlist on screen, and then have other people listen to it. Sounds familiar?

I bet it does. When Muxtape surfaced I had two questions (after I had a play at http://ewanspence.muxtape.com/). The first was the bandwidth issue, the second was the licencing costs. The former seems more important, but the latter is more than likely going to (a) kill the service and (b) land Oulette with a very large legal bill.

Putting in the phrase “By uploading a song you agree that you have permission to let Muxtape use it” will not be enough. He’s essentially a publisher of music, and he’s not paying ithe licence fee. And while I might agree with the idea of aiding discovery, promoting music, and everything that stands for, Muxtape is going about it the wrong way.

To make matters worse, he’s profiting from Muxtape users by Amazon affiliate links and is looking to continue monetisation.

One thing I added recently was Amazon affiliate links, and the conversion rate has exceeded my expectations. People are buying music they’re discovering on Muxtape, which is exciting. I haven’t totally ruled out ads, but for now I’m focused on ways to generate revenue that are more harmonious with Muxtape’s nature and purpose.

Muxtape is a great idea. There should be no reason for it not to work. But long term, this is a dead in the water, holded below the waterline business model. You;re not going to see a VC or anyone requiring due dilligence go near this one.

Which is a shame. But if you’re gonna play with fire…

…then you’re going to have your day in court. And I’m wondering, given how shady the background to Muxtape is, if this is a Sting 2.0 operation to force a legal onslaught and get before a Judge and Jury to try and sort out the online streaming / radio / download mess the US currently has? Because otherwise it looks way too foolhardy.

One Response to “Is Muxtape a Sting Operation Against the RIAA?”

  1. Music Like Water says:

    Nice research, but I have to ask you what rock you’ve been living under that meant you didn’t know about imeem.com

    They’re important to this story for a number of reasons
    1) They’re bigger than either site
    (http://siteanalytics.compete.com/imeem.com+muxtape.com+projectplaylist.com/?metric=uv)

    2) They lauched in 2004, before either sites,

    3) They let users upload tunes to their servers ad make playlists, which means they’re in the same business

    Which leads to the final point – they already got sued in court by the RIAA, and instead of fighting back they used their dominant market position to secure deals with the labels that were suing them and get the cases dropped.

    Now they’re not only the biggest player in the game they’re the only one legally authorized to play.

    So…. if that strategy worked for imeem, why won’t it work for muxtape?

    That’s the real strategy at muxtape, not only is the basic premise of the site a copy of another, the strategy to get attention and go legal is a carbon copy of imeem’s playbook.

    Meanwhile, sites which try to play fair like sonific.com are closing up shop because they’re not prepared to compromise their principles.