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Was Megaupload's New Pro-Artist Distribution Model The Real Reason Behind Shut Down?

Posted by: , 00:27 AEDT, Fri January 27, 2012

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Megaupload's intentions to launch a new service that would see artists sell directly to fans, and cutting out the major music labels, might have given the music industry extra reason to be happy to see Megaupload shut down by the FBI

Megaupload's shut down, and the arrest of its owner and operators, have been making the headlines recently, but had the take-down not occurred, Megaupload was set to be making headlines of a different kind, by launching a new service that would have made it even more of a hate target among Big Content.

Megabox was to be Megaupload's next big project, with key players in the online music industry, 7digital, Gracenote, Rovi, and Amazon MP3, all being partners, the idea was to create service that would see most, 90%, of all revenue go directly to the artist. An idea that probably terrified the music industry more than the alleged illegal going-ons at Megaupload HQ.

Megabox promised to not only pay artists 90% of all revenues earned on songs, by allowing artists to directly market to fans and completely cutting out the major labels, it even promised to pay artists for free music downloads, probably using the same business model that landed the website in big trouble with the US government last week.

While Megabox promised exclusive deals with artists, the service will mostly cater to unsigned artists. But if the service did work, it could spell the end of the monopoly the Big Four music labels have had on the music industry, and give more money back to the artists who actually create the music. The movie industry would then be next, with Megaupload's planned Megamovie launch. 

But "luck" was on the music industry's side, as Megaupload's take-down last week will almost certainly ensure the failure of Megabox, to allow them to keep the "artists who are eager to depart from outdated business models" (actual quote from the arrested Kim DotCom last year regarding Megabox).


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