Kim Dotcom - Megabox, disruptive new music service

I suspect that Kim Dotcom is something of a Walter Mitty figure, one of those people who fundamentally sees the world and his place in it very differently to how the rest of the world see him. As a result I don't think he'd view this as a change (which would involve him accepting that he'd been a heel in the past), I think he'd say he's still the way he's always been.

At the end of the day though I think he's in it for himself. He only wants to disrupt the music industry and free artists so long as it makes money for himself. He's clearly a smart and driven guy but I'd need to see a lot more than we've seen now to believe he's any sort of altruist.

He has been doing the exact same thing for almost 2 decades now. He started out on BBS and distributed "warez" over a bbs he ran and then famously turned everyone in the scene in to the police when they caught him and cut him a deal. He did the same thing with megaupload by providing a platform and making money from it and I am sure megabox will be like that as well. Lots of marketing hype and huge, romantic promises and lots of shades of grey and nothing much behind it, least of all a legitimate business.

Some of the stunts he pulled in between his BBS days and megaupload was to royally scam "letsbuyit.com" which he got convicted for and then he tried to open a "very high-wealth individuals" automatic trading system which obviously bombed. And back in the day he flamed the German CCC and loved to flash the word "hacker" as if he belongs. He sold a company he founded, DataProtect, to the renowned TÜV Rheinland and it turned out to be a scam and crashed. And before that he got caught dealing stolen calling cards.

He is and has been a trickster, an opportunist, a self-proclaimed "hacker" and above all an egomaniac who now, by sheer luck alone, finds himself on the more fortunate, romantic Robin-Hood side of things but his basic principles and ideas and greed haven't changed one bit.

He could make a profit with a smal percentage or via registration or per publish.

Problem is alot of artists who are in deals will not have the rights to there music to sell this way and those that do pay high percentages online in general, so viable for new talent in some ways.

We shall see.

Whether or not Megabox itself is a good thing, there's every reason to want to use a middleman when distributing music. Do you enjoy setting up web servers, employing web designers, handling CC transactions, selling ad space, etc? Or do you really enjoy making music and don't mind giving away a 10% slice to have someone else do all that?

I run a small music web server as a favour to a friend[1], and honestly it's a pain in the neck to manage it. If we could hand the whole lot over to whatever is the next MySpace, then we would.

[1] http://circulus.org

The profit model is upside down for him compared to the labels, though. The artists get 90%, rather than 10%.

"Interested to see what 'MegaKey' is."

The last time I checked, when Megaupload was still online and Megakey was being tested, it worked by replacing existing Internet-ads with ones served through the Mega-network when a person surfed the web. Essentially, it's a voluntarily installed ad-ware.

At I guess I would say it's going to be advertising. e.g. megaupload except 90% of profits on downloads the artist has endorsed goes to them. Instead of 100% to megaupload.

Probably with targeted upsells for more content from the artist as well.

Youtube already does that. If you flag that you own a video you'll get money from free views on it. But it barely works because it's too easy to abuse. Real artists often can't monetize their own videos because an abuser uploaded it first and claimed as his. Youtube is being abused to hell and google can't control it.

I wonder which genius solution megabox have to suceed where google failed. Or if it's just marketing.

I doubt it will be anywhere close to the quality that bandcamp currently offers. Given that this is Kim Schmitz we're talking about, I guess this will taste more like Grooveshark, operating in a very gray area, instead of a really caring about artists and listeners. But we'll see.

Besides I couldn't be more satisfied with bandcamp - this is a great place for artists and music enthusiasts alike. Everything from the flexible pricing options to the wide range of available formats and details like the lightweight and flawless HTML5 audio player and overall site design are very much appreciated. And perhaps most importantly there's actual talent to be found on bandcamp - it's hard for a competitor to build a similar community.

I may be wrong and this is very subjective and speculative but as far as I can imagine the average megaupload user I would expect to see a lot of low quality "DJ Überbazz"-kind of artists on Megabox instead of the ecclectic selection you would find on bandcamp. On the listener side - and again, if the Megaupload user base is anything to go by - I would imagine people that aren't that much into obscure indie artists and rather expect to find popular artists from major labels. For obvious reasons I guess that won't happen though - unless, of course, Megabox aims for Grooveshark's approach to featuring the repertoire of major labels.

Again, the last paragraph is pure speculation and just reflects what I expect from a music service by Kim Schmitz.

Bandcamp allows you to sell music, give it away, or let users choose a price. This will use MegaKey which as another comment explains is an advertising model. So consumers get free music and artists get paid 90% of the advertising revenue.

Bandcamp takes 15% from the music you sell (http://bandcamp.com/pricing/), apparently this service only takes 10%.

What you're hoping for is already here. I'm sorry since I already praised bandcamp in another comment, however this comes very close to the better way you mentioned. As an artist you have a lot of options today - a label contract is just one of them. Bandcamp, Topspin, CDBaby (are they still around?) or direct website sales are the alternatives. And of course let's not forget smaller independent labels. It is perfectly possible to be successful without a major label these days. If an artist decides to go the traditional route, it is his decision and it wasn't his only option.

I seriously doubt that Dotcom has the artists in mind with this new venture, it is a nice way to advertise the service though and he certainly knows that. Let's see.

Labels, both big and small, benefit many artists in ways outside distribution. Many musicians join labels to be financed, hand-held for recording, cross-marketed and advertised. The financing is significant, allowing many to produce novice music for long periods while improving their talents. Websites alone and zero-cost distribution methods, including streaming, don't allow the artist to survive. Not all artists want or need labels, but many opt for them. Interestingly, even the few artists who become popular without labels usually sign label deals for the business management and exposure. Free distribution doesn't help artists to pay for production, so Mega might have a problem there.