With Kazaa, TPB going legit, are illegal downloads over?

Is it the end of illegal downloading?

Hard on the heels of the acquisition of The Pirate Bay by Swedish company Global Gaming Factory, Kazaa has announced it's going legit, too. Read-Write Web notes:

For $20 a month, users will be able to download an unlimited number of songs. These songs, however, will be DRMed and in the WMA format, which will probably spell doom for the service in the long run.

Someone on these pages scoffed at the $1.9 million verdict against Jammie Thomas-Rasset, saying something like "Who cares about downloading music? I get all the music I want - and I find out about new music - for free - through satellite and web radio."

Exactly right. Eric Pfanner's piece in the Times last week profiled European streaming services, which are reporting that listening is up and unauthorized downloads down.

“Consumers are doing exactly what we said they would do,” said Steve Purdham, chief executive of We7, a service that says it has attracted two million users in Britain in a little more than half a year by offering unlimited access to millions of songs. “They weren’t saying, ‘Give me pirated music’; they were saying, ‘Give me the music I want.”’

In other words, recorded music is just data on which marketers must deliver their messages in some compelling way. You don't have to listen to Pandora to realize that visual ads in an aural medium are meaningless. But aural ads are not clickable. That points to a solution that exploits social networks to encourage people to interact with music. Getting people to embed music on their pages, getting a lot of friends redistributing, and returning all that data back to advertisers for targeted communications seems to be the way of the future.

The other issue is that someone has to underwrite web radio licensing costs. Pandora offers an annual subscription for unlimited ad-free music for $36 a year. As music moves from a product to a substrate for advertising, that starts to look pretty damn appealing.