The DRM-free download site could be music distribution's future
Beatport CEO Jonas Tempel has a dilemma. He wants to expand dance music's most popular digital retail site in an obviously profitable direction: hip-hop.
"There's amazing growth in hip-hop's digital DJing phenomenon," says the 37-year-old entrepreneur. "The problem is, all the music they play is off the major labels. There are DJs who want to play digital music, and they have to steal it."
Tempel is talking about how most of the major labels, which control mainstream hip-hop, are essentially unleashing only limited-use forms of their songs online. It's called "digital rights management," and it can restrict how you use music, the kinds of devices you use it on, and how many times you burn it to CD. While that might be fine for iTunes customers who enjoy tunage on the synergistic iPod, it's a tough sell for DJs, who want to edit and loop their sound waves (virtually impossible with iTunes), play their music on laptops and CD decks, and burn it at will (as in, 30 minutes before the show). Ableton Live laptop performance software, for example, will not play iTunes files. Therefore the DRM system, Tempel argues, actually encourages illicit file sharing. Why pay for an impenetrable shell when you can have the nut for free? Ironically, DJs usually have no problem throwing down a few bucks for a digital download. It's a steal compared to the $10 12-inch singles of just a few years ago.
For the electronic dance music faithful, at least, Tempel's house-, techno-, and trance-focused Beatport service (Beatport.com) has been a godsend. The three-year-old site - this year presented in an intuitive, browser-like version 3.0 - serves up music from nearly 4,000 labels, boasts 200,000 regular users, and offers unrestricted, CD-quality .wav files for a dollar more than the regular price of $1.99 to $2.49 per DRM-free MP3.
Sound expensive?
"Our philosophy is that DJs were used to paying up to $20 for a full vinyl album when they only wanted one mix off a release," Tempel says. "They also believe there's a premium to be paid for upfront, premium-encoded content."
Indeed, Beatport has taken the mystery, and perhaps some of the mystique, out of dance music. Only five years ago, DJs begged for limited releases. Now the 500-pressing "promo" is a relic, and unlimited, cutting-edge dance music from the likes of Booka Shade, 16 Bit Lolitas, and Plump DJs rolls out almost daily. Beatport encourages users to use partner Native Instruments' Traktor digital DJing software, while most digital hip-hop jocks seem to gravitate toward the Serato Scratch program. But mainly, spinners still prefer to burn to CD (yeah, vinyl's that dead). Beatport even peddles raw loops and a cappellas. Register, preview, buy, and download.
The site was conceived in 2002, when friend-of-Tempel Eloy Lopez came to him with a problem. Lopez had just purchased a digital DJing interface called Final Scratch but found that, in order to play dance music via MP3, he had to transfer vinyl to his hard drive, because downloads of choice e-music were few and far between. It seemed backward, because the tracks had usually started life as digital files. Tempel, CEO of Denver's Factory Design Labs (a "brand development agency" with clients such as Sony Pictures), gathered three other tech entrepreneurs and established Beatport in the Factory offices the next year. His biggest hurdle was convincing record labels to give him music unrestricted - essentially digital masters. Of course, it worked (with a majority digital dance market share, Tempel says), and Beatport gives its labels 60 percent of the take.
Now, does Beatport's unrestricted product line-up offer a model for the future of music distribution?
"DRM-free files are ideal for consumers," says music industry blogger Glenn Coolfer, founder and editor of widely read Coolfer.com. "DRM is something that had to be used while digital music is in its formative years. Labels needed some assurance that going online was not going to add to their piracy problems." Still, it's a wait-and-see situation right now. "Change will be gradual, and that frustrates a lot of people," Coolfer says. "Labels are starting to slightly ease up and experiment with DRM-free tracks (at Yahoo! Music, for example). It will take one successful experiment at a time if labels are ever to embrace open formats."
Until then, we'll stick with Beatport - and we'll edit, spin, and burn to our heart's content. Even if we have to avoid hip-hop.
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