[Sydney, AUSTRALIA] Online music provider ChaosMusic
has proposed a new levy on the distribution of digital music over the
Internet in a step to establish a profitable business model to capitalize on
the free transfer of music files.
In a letter to music associations and industry members, managers and
record companies, ChaosMusic has proposed a levy to initially use the
company’s online music search tool, FreeTracks, as a standard method to
generate a return for copyright owners.
From the creation of page impressions as a result of the FreeTrack search
function comes the opportunity to generate advertising revenue and promote
the physical carriers of digital music – CDs.
In an effort to recognize and renumerate copyright holders, ChaosMusic
has suggested 15 percent of all advertising revenues generated before costs
through FreeTrack should be directed to the appropriate royalty collection
body, and in turn to copyright owners – songwriters, published, record
labels and artists.
“We feel that this is a proactive and practical starting point for the
Australian music industry,” said ChaosMusic’s chief executive officer Rob
Appel. “In light of the legal battles in the U.S., we felt it was time that
the industry organizations in Australia start cooperating with each other,
in order to establish an acceptable standard for recognizing the copyright
component of online music,” he said.
The levy has been proposed to start immediately with all revenues
collected to be placed in a holding account until an appropriate agreement
between online retailers and the Australian music industry has been
reached.
“It is clear that the popularity of online music and the unauthorized
sharing of music will continue to grow exponentially over the next couple of
years,” said Appel. “It is also evident that any industry efforts to date
have failed to curtail this growth, and music file sharing will be very
difficult, if not impossible, to eliminate.”
ChaosMusic believes the use of FreeTracks will serve as a benchmark for
industry cooperation with the proposed structure likely to further develop
through its implementation and trial.
