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<b>Even as entertainment companies remain locked in legal battles against file-sharing services, some are quietly experimenting with ways to use the networks to their advantage. </b>
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One company, called BigChampagne, is tracking music downloads for radio giant Clear Channel. Another, Jun Group, is deliberately releasing music to Web file sharers in order to generate buzz. </p><p>
Jun Group's Mitchell Reichgut, a former advertising executive, said his service provides record labels with the means to transform their decades-old model for selling music. </p>
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"Basically, the labels have a choice. They can fight and continue losing money or try to tweak this 100-year-old model and get immediate results for artists, consumers and sponsors," Reichgut said. </p><p>
Jun Group recently reached agreements with a songwriter, a beverage company and a TV network--entities that would normally be very careful to protect their products--to release their content onto peer-to-peer networks. </p><p>
BigChampagne also tracks song-swapping networks such as Kazaa and Morpheus for record labels, which in turn use the data to persuade radio stations to play their songs. </p><p>
Tracking downloading activity can predict a hit before a song gets radio airplay. If a particular song is heavily downloaded, a record label could use that as a selling point to ask radio stations to put the song in a heavier rotation. </p><p>
"At any particular moment, we're working with most of the labels. This is an industry that relies on immediate data on consumer reaction," said Eric Garland, BigChampagne's chief executive officer. </p><p>
Label executives say BigChampagne provides both a gauge of consumer tastes and an indication of piracy trends. </p><p>
"We're definitely using it as a tool. It's just part of a bigger trend of the labels using real data to figure out marketing plans--as opposed to radio charts that are not tied directly to consumer information," said Jeremy Welt, head of new media at Maverick Records, a Time Warner label. </p><p>
<b>Undercutting the legal battle</b><br />
Many labels are hesitant to admit that they are talking with Jun Group or using BigChampagne, due to the industry's antipiracy fight. The industry's argument in court battles against file sharing hinges in large part on the argument that file-sharing networks serve no purpose other than to foster copyright infringement. </p><p>
Record labels' use of file-sharing networks for market research or promotion purposes could undercut that legal claim. </p><p>
"It's remarkable, the disparity between the labels' legal battle and their understanding that product is moving online and a desire to be at the fore of the movement," Garland said. </p><p>
While BigChampagne uses music download data for market research, Jun's promotion method is more direct. It distributes material to the top levels of the file-sharing universe--the more technical users who trade files on Internet Relay Chat and Usenet. </p><p>
"Known as the Internet arbiters of cool, they get the content first and distribute it through the rest of the community, creating a buzz. That is why it is such a powerful vehicle for marketing," Reichgut said. </p><p>
From this top tier of Internet hipsters, the content potentially trickles down to millions of people on networks like Kazaa. </p><p>
Reichgut said Jun used this method to boost ratings for a daytime program on a TV network that wished to remain anonymous. </p><p>
"The show had a spike in ratings after Jun made a clip available on file-sharing networks," said Reichgut, who formed Jun with a former Harvard University physics professor, Mitch Golden, and antipiracy consultant Bruce Forest. </p><p>
Jun detailed another deal with chocolate drink maker Yoo-hoo, which is owned by Cadbury Schweppes, and Kevin Martin, former front man for the rock band Candlebox. </p><p>
Under the deal, Yoo-hoo sponsored a five-song release by Martin's new band, Kevin Martin & the HiWatts, which involved giving the songs away online. Unlike typical record deals, the songs carry no restrictions and can be freely copied. The catch is that, when played, they display a message on listeners' computers that credits Yoo-hoo. </p><p>
Under the deal, Martin got a fee from Yoo-hoo and financial support for his tour, while Yoo-hoo gained access to millions of file sharers. </p><p>
Jun and Yoo-hoo now have a patent that's pending on Jun's proprietary method for distributing content. </p><p>
Jun expects to announce more deals with recording artists and movie companies, while BigChampagne recently signed a deal to provide data to Clear Channel Communications' Premiere Radio Networks, which runs the airplay-tracking system Mediabase. </p><p>
Maverick Records' Welt said there were still mixed feelings about using the services. </p><p>
"It's unfortunate that all this file sharing is happening, and we have to see all the music that is being taken, but at the same time, we have to look at it from every angle. We'd rather get this data from legitimate digital sales and stores, but we're in a transition phase right now," he said. </p><p>
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