Rock River Communications recently became among the first companies to sign contracts with record labels licensing songs for podcasts. These deals mark an important first step in the beginning of the industry's recognition of the opportunities for growth that may exist within podcasting.
According to a piece in today's Wall Street Journal, Rock River will be producing a series of podcasts promoting products manufactured by Ford and DaimlerChrysler, among others. These companies will then pay Sony a flat fee for the use of the songs.Outside of this sort of arrangement, it is difficult to see how labels would collect money for podcasts. Since most people who create podcasts do it for free and then distribute them on the internet, it's unclear where the money would come from. It's a little bit like trying to collect royalties from a guy on the street who blasts his Discman a little too loud so that other people who did not pay are able to hear it. There's no one profiting and therefore no one to seek royalties from.
However, this is a good first step by the record labels in trying to work with advancing technology rather than fighting what is likely to be a fruitless battle in the long-run. If this partnership works well, we could start to see a lot more promotional podcasts in the near future.
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