Audiogalaxy Pacts With Listen.com

File-swapping site audiogalaxy.com—which used to be one of the leading sources of pirated music content on the Web—has quietly become a distribution partner for listen.com's Rhapsody subscription service.

Listen—a provider of on-demand music streaming and the only company to have content licensing deals with all five major labels—apparently has been allowing audiogalaxy.com users to try Rhapsody without charge since Labor Day. The limited-time free offer is a standard marketing tactic that listen.com extends to all of its distribution partners and runs through Sept 15. Users do not have to provide credit-card information to test the service.

As the industry steps up its litigation efforts against peer-to-peer (P2P) sites (see story, this page), operators of such services are increasingly exploring alternatives to free file sharing that do not run afoul of the music industry.

Looking to avoid an expensive and crushing court fight with the Recording Industry Assn. of America (RIAA), Audiogalaxy in June settled a copyright-infringement suit filed by the RIAA, the National Music Publishers' Assn., and the Harry Fox Agency.

As part of the settlement, the Austin-based company agreed to block the swapping of copyrighted works by installing a "filter-in" system that requires pre-approval by a songwriter, publisher, and/or recording company before a track can be shared on the network.

The deal between Audiogalaxy and Listen marks the first commercial deployment of a major-label-sanctioned subscription service through a P2P network. Napster at one point had a deal in place to distribute MusicNet; however, the agreement was never acted upon, and the alliance fell apart.

What a deal to distribute Rhapsody means for the future of Audiogalaxy remains to be seen. Sources familiar with the situation call the agreement an experiment and not necessarily indicative of the company's post-lawsuit settlement strategy. Audiogalaxy and Listen executives declined comment.

The deal is the latest sign of increased experimentation with distribution of legitimate content through channels primarily known as piracy hubs. Altnet, the secure file-swapping service that runs simultaneously with the Kazaa P2P network, has distribution deals in place with Maverick Records, Best Buy's Redline Entertainment, Palm Pictures, and Microsoft.

Sony and Vivendi Universal are experimenting with secure P2P distribution through CenterSpan Communications, owner of scour.com.