January 28, 2008 6:00 AM PST

Music labels decide that "free" might be a winning strategy, after all

Posted by Matt Asay

For years the music industry has fought the idea that music should be free. Today, it has decided to play along.

In a sign that the music labels are finally desperate enough to experiment with new models of distribution and monetization, more and more bands and their labels are following in the footsteps of Radiohead to discover that "free" can pay.

Now a host of new services, with the backing of major labels, are promising to revolutionise how music is distributed by offering millions of tracks, from much-hyped wannabes to established acts such as U2, for nothing.

Competing for attention at the Midem trade show, the services promise a global jukebox, paying for the free music by attracting advertising. Meanwhile, some acts are queueing up to swap their deals with labels for agreements with big advertisers which would further blur the line between bands and brands.

Will it work? That remains to be seen. But the advertising-based models, among others, are at least finally discovering that perhaps there are different, better ways to monetize music - ways that take into account ease of distribution and rely on this ubiquity of content to open up alternative ways to put a price on the content.

I personally believe that we've long had a payment problem in digital music, not an IP problem. It's not that people want to steal. It's just that the labels have made it unbearably and unreasonably hard to access music in a 21st-century manner...and pay in a 21st-century manner.

Will these attempts turn to gold? Probably not. But they're on the right track. I think we'll see some successes start to emerge, and a new, brighter future for the music industry as a result.