Record deal for Fanning's swap service

Fanning's company has developed a range of tools that allow songs to be identified as they're traded online, and lets those trades be turned into sales. Labels see the technology as a potential way to turn anarchic peer-to-peer networks into profitable distribution tools equivalent to Apple Computer's iTunes.

The deal is the second for the young service. Late last year, Universal Music also agreed to put its catalog of music into Snocap's song-identification databases.

Snocap's technology "will help to curb copyright infringement, and will facilitate the creation of legitimate, authorized P2P services," Thomas Hesse, president of SonyBMG's global digital business division, said in a statement.

The deal highlights labels' growing willingness to experiment with peer-to-peer distribution of their music, as long as it is done on their own terms.

Snocap's system allows the creation of swapping environments where individuals can essentially sell each other their favorite music. It's designed so that peer-to-peer networks can plug the identification technology into their own software, blocking unauthorized trades and turning others into sales.

At least one company, called Mashboxx, is planning to launch a service based on Fanning's work later this year.

File-swapping network Imesh is also planning to transform itself into a place for authorized song swaps later this year, but is developing the service using different song-identification technology from a company called Audible Magic.