 Many industry executives noted that when peer-to-peer took hold in 2001-2003 thats when sales began to decline. “That’s when we went from music having real value in people’s minds to music having no economic value, just emotional value.”
The flood gates are now open and Sprint has signed on as the first company to underwrite a song to be distributed on file-sharing networks, agreeing to embed its logo on copies of tracks from Atlantic Records hip-hop artist Plies.
Sprint and Atlantic Records are teaming with ArtistDirect’s Media Defender division for the initiative, which essentially amounts to an advertising buy for the telecom company.
According to sources, Media Defender will push 16 million Plies song files embedded with the Sprint logo onto peer-to-peer networks over a three-month period in return for a “substantial six-figure” fee to be divided between Media Defender, Atlantic Records, Plies and his publishing company.
Once embedded, the Sprint logo will be attached to the files forever and will appear alongside Plies’ name and the song title on the screen of a desktop computer, iPod, cellphone or any other digital music player.
The vast share of music consumption, particularly for the under 35 set, is done on file-sharing networks. ArtistDirect CEO Jon Diamond said the initiative serves the triple purpose of generating advertising income for record labels, curtailing piracy and allowing brands to associate with key artists to reach a desired demographic.
According to Steve Yanovsky, a former record industry executive who consults for Mindshare Interactive, which counts Sprint as a client, the deal positions Sprint “as an innovator and will help drive perception of them in the marketplace.”
How it works…………..
1) Sprint pays for the right to embed its logo in 16 million song files
2) People download the song for free from file-sharing sites
3) When song is played, the artist’s name, song title, and sprint logo will appear on screen
4) Money is split between technology company, record label, artist and music publisher
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