me*dia*or

Last weekend, Music Ally headed for New York to attend an event called GFC Vision. GFC is a group of 10 creatives – DJs, graphic designers, producers, artists and labels – led by Pedro Winter, ex Daft Punk manager, and now manager of Justice and Parisian label Ed Banger Records.

But the driving force behind it is US beer company Miller Genuine Draft, which is trying to associate itself with innovative music thinking. A bit like Bacardi, except instead of ‘signing’ Groove Armada, they’ve gathered this bunch of creative types who are apparently going to meet every six months somewhere in the world, and Discuss Music Stuff.

The panel is suitably cosmopolitan: DJs from the US, Japan and Russia, hip-hop artists from South Africa and South Korea, and so on. It reminds us a bit of that Nokia Music Recommenders project a while back, except instead of compiling music playlists, this panel is compiling and swapping ideas. The inaugural event that we attended featured a guest speaker, former journalist, pirate DJ and now author Matt Mason. Read on for our report.

Actually, the most interesting session was the middle one, where Mason gave a talk based on his book The Pirate’s Dilemma.

To paraphrase and summarise, it boils down to the fact that there have been pirates throughout history, and they’re usually a response to some flaw in the developing systems of the day. You have to recognise what the flaws are, and work out why the pirates are succeeding. Mason gave the example of Radio 1 in the UK setting up and poaching DJs from pirate station Radio Caroline. We think the book is well worth a read.

Pedro Winter certainly has strong views about the way things are going in music now. “The indies have got to have a different approach from the majors,” he said. “The majors have been shooting themselves in the foot, so let them die alone, as they say in France … It’s why Daft Punk quit a major.”

He also thinks the approach of the major labels and authorities towards online piracy is counter-productive (and remember, France is where the three-strikes debate has been raging): “We’ve got to stop talking about kids as thieves. It’s just a new way of consuming music … I’m a hippy at heart. I didn’t have a problem with the kids downloading music.” For what it’s worth, Winter is dismissive of the whole three strikes proposal and believes Sarkozy will ‘put it back into his pocket.’

South Korean hip-hop artist Tablo had some interesting things to say, too, on how he’s been giving stuff away for free and then making money off the back of it.

“We used to sell a lot of CDs but no merchandise, so we set up a website with merchandise, but no one was buying it. So we gave out a few free songs, but also gave out samples like kicks from our tracks. People had to go there [the website] to get the free stuff, and the merchandise sales went up.”

However, Tablo also said that giving music away makes it disposable, pointing out that five or six years ago in Korea, people would listen to a song for four or five months, or even a year. Now, in a few days they’re bored and want more songs from their favourite artists. This, he thinks, can compromise the quality of the music.

All interesting stuff; diluted slightly by the following session on finding ‘the perfect equation for collaboration’, which went a bit moodboard brandspeaky. “The perfect equation for collaboration is passion.” And so on.

In fact as the audience drifted off, it got us thinking: the fact that Miller is doing this event is as interesting as what was actually discussed. We’ve not seen this kind of futuregazing panel played out in public as part of a brand promotion, rather than at an industry conference like MIDEM. Clearly the company was hoping to ‘amplify its brand values’ through the event and to use the assembled journalists to convey the fact that Miller is a brand which helps creative collaboration. Which is kind of what we’ve just done.

It’s early days to judge the success of Miller’s attempt to portray itself as “a beer brand with music at its heart”, but Vision is clearly just one part of its strategy – the company also sponsors a venue called The Mill in Scotland which puts on up-and-coming acts, while also launching the Miller Music Factory in Turkey, and The Miller Foundation in South Korea. All in all, probably more worthy than a public moodboard workshop in New York.

We7 has bagged the rights to stream the new album by hotly-tipped UK artist Florence & The Machine – but only for this weekend. It’ll then be whipped off for a week while it goes on sale, before becoming available on We7’s service for streaming again.

Anyway, there’s a button below to listen to the album, although it won’t work until midnight tonight UK time. Enjoy!

	Play Florence + The Machine’s Lungs

It was the story of an e-mail heard around the world. You may remember Jérôme Bourreau-Guggenheim who expressed opposition in an e-mail to his member of parliament. That e-mail went back to his employer, TF1, who then promptly fired him because of his political views back in May. Now, Bourreau-Guggenheim is suing TF1 for discrimination.

His journey throughout all of this probably started off as a humble employee, working at Frances broadcaster, TF1. He probably had no idea that one day, he’d be the centre of a major political debate that the whole world is watching at the time.

Then, the HADOPI law debate came up. Three strikes and your out for copyright infringement online. At the time, the proposal would have no judicial oversight whatsoever – not to mention being forced to pay your subscription fee even though you have been, well, banned from the internet. You’re name would be added to a blacklist so you can’t subscribe with another provider and the amount of time you were disconnected, at the time, was still being determined.

Not surprisingly, the law was just about as controversial then as it is now. For Jérôme Bourreau-Guggenheim at the time, he wasn’t exactly too keen on the law either. So, while at work, he sent an e-mail to his member of parliament to express his personal opposition to the “three strikes” law. His member of parliament’s office, who also happened to be part of the governing party, UMP, then forwarded the e-mail to the minister of culture who then forwarded the e-mail to his employer, TF1. Bourreau-Guggenheim boss then hauled him into his office where he was showed a copy of his e-mail before he was fired for “strategic differences”

His story hit several major French newspapers. He went from just a side-line employee to a front-line borderline celebrity who is against the French three strikes law. The story has since caused political waves.

Now, it seems, a new development has happened in this case. French newspaper, Le Monde, is reporting (Google Translation) that Bourreau-Guggenheim is suing his former employer, TF1, for discrimination. His lawsuit is based on article 225-2 of the penal code which addresses “violations of human dignity”.

The punishment for such a violation is up to three years in prison and a 45,000 euro fine. That article specifically deals with an employment dismissal based on a political viewpoint.

Le Monde makes an additional interesting point:

By revealing the affair in its issue of May 7, Libération had quoted from the letter explicitly refers to mail sent to Ms. de Panafieu. Including this clarification: “This correspondence was received through the office of the Minister of Culture, which has posed address the same day the company TF1. A path to strong symbolic resonance, given the suspicions about the relationship between power and sarkozyste audiovisual group, whose main shareholder, Martin Bouygues, is the near the head of state.

Another part of the article says:

It is true that the case has already made much noise but it has needed to add: wrangling in the Assembly, where the former Minister of Culture, Christine Albanel, has been strongly implicated by the opposition; sanction against the member of his Cabinet who had transferred to the TF1 mail received from Ms. de Panafieu (Le Monde, 12 May).

Now committed criminal in a long process, Mr. Bourreau Guggenheim-must adapt to circumstances. To live this matter without further destroying his career. Say they have had “some contact with elected representatives of the opposition, which (l ‘) were invited to participate in debates on Hadopi”, the former part of TF1 should also “reassure (the) future employers” when is invited to an interview. TF1 who denounced “positions (…) radical expressed publicly,” he defends himself on these two points: “I am loyal, I have nothing being published at TF1. And I am not an extremist free download.”

At this point in time, it’s not hard to see this as a no win situation for the UMP of France, not to mention TF1 who is neck deep in this political fiasco as well. It would appear that Bourreau-Guggenheim has a number of additional options should things go sour for him including referring to the European Court of Human Rights. Though one can only imagine how much additional political damage that would cause for the government who is not only intending on pushing through the three strikes law at all cost, but also changing around the French court system and giving judges only approximately 5 minutes to rule on each disconnection.

This case about a French employee fired for opposing the three strikes law, unfortunately for TF1 and the UMP, isn’t going to go away any time soon.

Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

This just in from digital distributor TuneCore:

To get venture capital you need to be pitching a business which can get very big. To make a music company which does that much volume you need to pursue mainstream listeners. To capture mainstream listeners you need content in the short head.

Ergo, eMusic did a deal for music from Sony’s catalog, like Bob Dylan. To do it they needed to raise prices substantially.

But eMusic’s longtime subscribers were evidentally able to get by without Sony’s catalog, and were customers on the basis of lower prices.

The new prices are about double the old ones. The new catalog is shallower, not deeper, so it doesn’t serve the needs of this user base. Higher prices, lower quality.

You see where I’m going with this. Good luck and god speed to you, eMusic. May the road rise with you and the wind be at your back. See ya wouldn’t wanna be ya. Git along little dogie.

But here’s what I’m wondering: who’s going to serve us niche buyers? Is there really no business here? Because I personally wanted more hopelessly obscure electronica, comedy proto-funk, and barely audible wax cylinders, and I can’t be the only one. So whose customer are we now?

And I don’t mean which baby business is willing to take our money until it grows up. Our money’s green as anybody’s — who want it?

There’s a tension between profitability and scale. With niche customers you can earn more per customer but less overall, because there are fewer customers… So don’t talk to me about long tail music, because it’s really a different kind of business than short head music. It’s not selling more of less. It’s a different kind of product with higher margins but lower volume.

If you took a holiday or some time out to celebrate, would you take your smart phone with you? You're darn tootin'. How else would you be able to tweet taunts to your friends stuck at work or post beach pics to Facebook that you might rethink after that recovery hydration period?

Here are a few mobile apps to help make your holiday and vacation travels more enjoyable.

If you are taking a trip that requires more than just a GPS, WorldMate offers apps for a number of smart phone platforms -- yes, that includes iPhone, BlackBerry and Windows Mobile phones. (Check here to find out if it's available for your phone.) And there are free and paid versions. The app includes a mobile itinerary, which syncs with the online platform. Basically, if you can think of it, this app has it: travel clocks, maps and directions, hotels, friend finder, weather monitor and currency converter, to name a few features. The paid version of the app, or gold-level subscription, offers real-time flight updates for 350 airlines and airline alerts and lets you look up the status of flights and search airline schedules. The BlackBerry and Windows Mobile Gold version is either $14.95 monthly or $99.95 annually. The iPhone app paid version is going for $9.99 -- that's right, no monthly fees. But hurry if you want it -- the iPhone deal lasts until midnight July 4.

Another app that's available across platforms is Zagat to Go. This app offers Zagat's signature ratings and reviews of more than 40,000 venues, GPS support for directions and reservations. For devices other than iPhones, there's even a 14-day free trial.

The word most used on vacation seems to be "where." The Where application gives you local insight, with info on weather, news, restaurant reviews, cheap gas and movie show times as well as maps and directions. It's available on BlackBerry, G1 Android, iPhone and Pre. There's also Facebook integration with an app called "Buddy Beacon."

A few apps specifically for the iPhone

Postman (99 cents)

What it is: This app helps you create a digital postcard using photos you have on your iPhone, image templates or your location. Just add text. You can deliver it by e-mail, Facebook, Tumblr or Twitter.

Bottom line: They do look pretty good. It's a cheap way to get pictures and sentiments from your travels to the people you love before you return from the trip. And the app costs less than either the postcard you'd buy, along with postage to send it.

Kids Eat Free (99 cents)

What it is: This app does as it advertises and finds the eateries that offer free food for the kiddies. You can search by location, city or ZIP code. Each entry offers the parameters of the deal, address and phone number. (You might consider calling ahead to make sure the offer hasn't changed.) It also will launch Google Maps for directions.

Bottom line: Kids, precious as they are, can be pricey. The money you save with this app on feeding them could go toward that college fund.

AAA Discounts (Free)

What it is: Except when I'm booking a hotel or stuck on the side of the road, I usually forget to use the benefits of AAA membership. This app helps you to find the spots along your path that offer AAA discounts. Using native location services on the phone, this app has "find me" and "follow me" functions to better identify where you can save along the way. It also gives point-to-point directions. It searches for shopping, dining, lodging, entertainment, health, auto, travel and services, or all of the above. Plus, if you do get stuck on the road and need assistance, instead of having to look up the number you can just tap the app to call for help.

Bottom line: Who can afford to pass up discounts these days -- plus you're really already paying for the privilege with your annual dues, right?

If you have any favorite apps that make your travels more fun, streamlined or affordable, share them with by tweetin us on @Appiphilia, dropping a line at Facebook or writing a comment below.

Happy Fourth of July weekend!

-- Michelle Maltais

Subscribe to the Appiphilia RSS feed and follow us on @Appiphilia or Facebook.

Next week (July 8th, 2009), FMC Communications Director Casey Rae-Hunter will participate in a “HealthCare Remix” Discussion on Reform at the Service Employees International Union in Washington DC.

For our part of the conversation, we'll be talking about the issue of health insurance and musicians. Specifically, we'll describe the Health Insurance Navigation Tool (HINT) — a free service that provides musicians with high-quality one-on-one info about their health insurance options, from a fellow musician/health insurance expert. (HINT doesn't sell insurance or even make recommendations — it's an information resource for musicians to get a handle on what their options are).

The official media advisory is below:

“HealthCare Remix” Discussion on Reform

SEIU, Lupus Foundation for America Greater Washington, & Future of Music Coalition to hold open discussion on how individuals in the arts & beyond can benefit from reform

[Washington, DC] – In 2005, J Dilla was an influential hip-hop producer and rising artist whose promising life was cut short by complications stemming from his battle with Lupus. Without health insurance, the costs associated with his care reached triple digits. In the United States, 60% of uninsured Americans are self-employed or employed by a small business that does not offer health benefits. Please join us for a discussion on how healthcare reform can prevent the kind of financial stress and hardship the Yancey family has endured due to the high cost of medical treatment.

WHO: Mr. Malik “Phife Dawg” Taylor, member of A Tribe Called Quest & Diabetes patient; Ms. Maureen “Ma Dukes” Yancey, J Dilla’s mother; Dr. L Toni Lewis, President of Committee of Interns & Residents/SEIU; Reverend Lennox Yearwood, Hip Hop Caucus; Casey-Rae Hunter, Future of Music Coalition

WHAT: Roundtable discussion about healthcare reform and its implications for individuals in the arts and beyond.

Where: SEIU International Headquarters
1800 Massachusetts Ave, Washington, DC

When: Wednesday, July 8th 1 – 2 PM

To RSVP: Please RSVP to healthcareremix@gmail.com.

The event is planned in conjunction with the 4th Annual J Dilla Tribute & Fundraiser presented by SEIU, LFAGW & Hedrush Entertainment, hosted by Phife (ATCQ) & Grap Luva @ Liv Nightclub on Wednesday at 9 PM. Special guests include: J Dilla's mom, Ma Dukes Yancey, and his younger brother, Illa Jay. For questions or more information about the Tribute Event please call Elizabeth Muniot at 202.212.6760.

###

With 2 million members in Canada, the United States and Puerto Rico, SEIU is the fastest-growing union in the Americas. Focused on uniting workers in healthcare, public services and property services, SEIU members are winning better wages, healthcare and more secure jobs for our communities, while uniting their strength with their counterparts around the world to help ensure that workers--not just corporations and CEOs--benefit from today's global economy.

Founded in 1974, the Lupus Foundation of America Greater Washington (LFAGW) Chapter, Inc. provides free, current information, education programs and outreach services to improve the quality of lives for people with lupus while also supporting research. Toll-free number in D.C., Md., Va. and W.Va.: 1-888-349-1167 or 202-349-1167. Web site: www.lupusgw.org.

The Hip Hop Caucus, founded on September 11, 2004, has developed a 700,000 member national database, and created field teams in 48 cities across 30 states. The mission of the Hip Hop Caucus is to work towards ending urban poverty for the next generation. We organize young people in urban communities to be active in elections, policymaking, and service projects. Through Hip Hop culture, celebrities, cultural media, technology, and grassroots organizing, we reach young people of color from low-income communities, who are traditionally unengaged in the political process.

About Future of Music Coalition
Future of Music Coalition is a national non-profit education, research and advocacy organization that seeks a bright future for creators and listeners. FMC works towards this goal through continuous interaction with its primary constituency — musicians — and in collaboration with other creator/public interest groups.

I was delighted to be invited to make a contribution to the RSA Journal's July 2009 edition, the printed version of which was just send out I believe, and the online edition that just went up on their website.

The complete title of my piece is: "The price of freedom - reinventing the online economy: Gerd Leonhard explains why ‘free’ content can still pay in the long term" and I really enjoyed writing this for them.

Following my last presentation at the RSA, in April 2009, on 'The Future of Content and Creativity' I have had many good conversations about this topic. The audio track from this event is here, btw; and the video is embedded again, below. Enjoy. And RT;)

I definitely recommend that you check out the other great features in the Juy 09 RSA journal, as well, there's some great gems in there.

You can read the entire thing on the RSA page, so here is just an excerpt:

"Free information, free music, free content and free media have been the promises of the internet (r)evolution since the humble beginnings of the World Wide Web and the Netscape IPO on 9 August 1995. What started out as the cumbersome sharing of simple text, grainy images and seriously compressed MP3s via online bulletin boards has now spread out to every single segment of the content industry – and even into ‘meatspace’ (real-life) services such as car rentals. Without a doubt, ‘free’ has become the default expectation of the young web-empowered digital natives and now the older generations are jumping in, too.

On top of the already disruptive force of the good old computer-based Web1.0, we are witnessing a global shift to mobile internet – a WWW that is, finally, so easy to use that even my grandmother can do it. While five years ago, we needed a ‘real’ computer tethered to a bunch of wires to port ourselves to this other place called ‘online’ and partake in global content swapping, now we just need a simple smart phone and a basic data connection. With a single click of a button, we’re in business – or rather, in freeloading mode.

As users, we love ‘free’; as creators, many of us have come to hate the very thought. When access is de facto ownership, how can we still sell copies of our creations? Will we be stuck playing gigs while our music circles the globe on social networks, or blogging (now: tweeting) our heart out without even a hint of real money coming our way?

Daunting as it may seem, we can no longer stick with the pillars of Content1.0, such as the so-called fixed mechanical rate that US music publishers are currently getting ‘per copy’ of a song ($0.091). Nobody knows what really defines a copy any longer when the web’s equivalent of a copy (the on-demand play of that song on digital networks) may be occurring hundreds of millions of times per day. No advertiser, no ISP and not even Google has this kind of money to pay the composer (or rather, the publisher), at least not until the advertisers start bringing at least 30–50 per cent of their global US$1 trillion marketing and advertising budgets to the table.

Traditional expectations and pre-internet licensing agreements are exactly what are holding up YouTube’s deals with the music rights organisations such as PRS and GEMA: this is what the rights organisations used to get paid for the music that is being copied, and this is what they want to get paid now. This impasse is causing significant friction in our media industries worldwide. Yet, below the top-line issue of money, there lurks an even more significant paradigm shift: the excruciating switch from a centralised system of domination and control to a new ecosystem based on open and collaborative models. This is the shift from monopolies and cartels to interconnected platforms where partnership and revenue sharing are standard procedures. In most countries, copyright law gives creators complete and unfettered control to say yes or no to the use of their work. Rights-holders have been able to rule the ecosystem and, accordingly, ‘my way or the highway’ has been the quintessential operating paradigm of most large content companies for the past 50 years.

Enter the internet: now the highway has become the road of choice for 95 per cent of the population, the attitude of increasing the price by playing hard to get is rendered utterly fruitless. Like it or not, a refusal to give permission for our content to be legally used because we just don’t like the terms (or the entity asking for a licence) will just be treated as ‘damage’ on the digital networks, and the traffic will simply route around it. The internet and its millions of clever ‘prosumers’, inventors and armies of collaborators will find a way to use our creations, anyway. Yes, we can sue Napster, Kazaa or The PirateBay and we can whack ever more moles as we go along. We can pay hundreds of millions of dollars to our lawyers and industry lobbyists – but none of this will help us to monetise what we create. The solution is not a clever legal move, and it’s not a technical trick (witness the disastrous use and now total demise of Digital Rights Management in digital music). The solution is in the creation of new business models and the adoption of a new economic logic that works for everyone; a logic that is based on collaboration, on co-engagement and on, dare we mention it, mutual trust – an ecosystem not an egosystem. Once we accept this, we can start to discover the tremendous possibilities that a networked content economy can bring to us.  

Free, feels-like-free and freemium

Much has been written on the persistent trend towards free content on the net. It is crucial that we distinguish between the different terms so that we can develop new revenue models around all of them. ‘Free’ means nobody gets paid in hard currency – content is given away in return for other considerations, such as a larger audience, viral marketing velocity or increased word of mouth (or mouse). I may be receiving payment in the form of attention, but that isn’t going to be very useful when it’s time to pay my rent or buy dinner for my kids. Free is... well, unpaid, in real-life terms.

 ‘Feels-like-free’, on the other hand, means that real money is being generated for the creators while their content is being consumed – but the user considers it free. The payment may be made (ie sponsored or facilitated) by a third party (such as Google’s recently launched free music offering in China, Top100.cn); it may be bundled (such as in Nokia’s innovative ‘Comes With Music’ offering, which bundles the music fee into the actual handsets) or the payment may be part of an existing social, technological or cultural infrastructure (such as cable TV or European broadcast licence fees) and therefore absorbed without much further thought. Feels-like-free could therefore be understood as a smart way to re-package what people will pay for, so that the pain of parting with their money is removed or somewhat lessened – everyone pays, somehow, but the consumption itself feels like a good deal...." Read on. PDF: Download RSA - The price of freedom Gerd Leonhard July 2009

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• The Future of Music & Media: Gerd Leonhard at Plugg 2009 (blip.tv)

Does embattled music streaming site imeem think it can take on iTunes? For the most part, nearly every streaming song on the site has a download button which links to both iTunes and the Amazon MP3 store. But it is quietly testing its own music download store which bypasses iTunes and Amazon and sells MP3s directly. For instance, this is the case with some Sub Pop artists, such as Iron and Wine and The Shins. When you hit the download button on songs for those artists, a window pops up showing the album where that song came from with with the option to download the entire album or any individual song for $0.99 (see screenshot above). You can then pay imeem directly by credit card or Paypal and download the song to your computer.

This imeem music store is obviously an experiment. The vast majority of songs still direct users to iTunes or Amazon for downloads, and you’d expect imeem to provide its own lightweight desktop client to manage and store the downloads, or at least place them directly into iTunes instead of a download folder on your computer. But it is also likely a sign of things to come. After nearly running out of cash because it was paying out too much money to the music labels for streaming rights, imeem went through a sever recapitalization. Warner Music ended up taking a $20 million hit to write down its investment and bad debt from imeem. Instead of walking away, however, Warner renegotiated its deal with imeem to get new shares without putting in any new money.

Imeem is doing everything it can right now to cut costs and find new sources of revenue. Last week, it announced it will soon stop storing user’s photos and videos, an expensive remnant from its earlier strategy to compete with Facebook and MySpace as a larger social network. Now, imeem is focusing on being a music site. It was one of the first sites to strike streaming deals with all the major labels and for the most part has renegotiated those on more favorable terms. Its iPhone and Android apps, which also offer streaming music, are taking off and driving even more downloads.

And that’s where the imeem music store comes in. Currently, imeem gets a dinky 5 percent affiliate fee for every song its users buy from iTunes or Amazon. As part of its renegotiations with the music labels, it is getting download rights along with its streaming rights I’ve been able to confirm. Instead of getting a few pennies for each song from iTunes and Amazon, imeem can capture the roughly $0.30 per song that doesn’t go to the labels. What is more likely, however, is that it is giving the labels more than the 70 percent cut they get from Apple. Even if it splits its share with the labels and takes only $0.15 per song, imeem still stands to triple its download revenue. Add in ringtone sales and its existing advertising revenues (imeem attracted 25 million unique visitors worldwide in May, according to comScore), and imeem might just have a chance to survive. But if it does survive, it probably won’t be because of its advertising model alone. It will be because the free music is driving enough sales of actual music downloads.

Update: Imeem has confirmed that it is planning to roll out this store more broadly, but says that when it does it will continue to offer iTunes and Amazon downloads as an option.

Below are screenshots of the new post-payment window for songs imeem sells itself and the regular affiliate link window which still pops up for most downlods:

Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.

Everyone knows you can make music with an iPhone – artists like The Mentalists and Gary Go have got media coverage as a result. But shooting a music video?

It’s possible with the new iPhone 3GS, and US artist Ben Rivet is the first to benefit, courtesy of a production company called Showdown Productions. See the results above.

However, they also used a fairly price-looking steadycam system, which rather goes against the ”anyone can do this with an iPhone” spirit of the project. Even so, it’s canny marketing on the part of both Rivet and Showdown.

Digital distributor TuneCore claims rapper Drake has sold nearly 300,000 song downloads on iTunes in two weeks, which it says is a record for a DIY artist (i.e. one without a label).

The success appears to be fuelled by his single Best I Ever Had. It shouldn’t come as a surprise, though. Last month, someone uploaded an unauthorised Drake album to iTunes, Rhapsody and Amazon, and it became the 16th best selling digital album in the US that week.

At least now, the sales are for the kosher product.

Global Gaming Factory CEO Hans Pandeya has been explaining his company’s plans for taking The Pirate Bay legit, following its acquisition earlier this week.

In short, he plans to pay users for sharing files, and pay rightsholders who provide the files that are shared. And he’ll raise money from ISPs in return for reducing the strain on their networks.

“Let’s say a popular song comes out. Rather than a million downloads from a site – which would cause a considerable strain on that ISP – we can take that song and put it out on P2P,” he says.

As Mashable points out, this strategy depends on a.) users sticking around, b.) rightsholders agreeing to such a deal, and c.) ISPs seeing enough benefits to pay for it. Meanwhile, Business Week highlights more potential legal and commercial obstacles to the new plan.