Plugged:

This was one of those rare weeks that there were more "best of" contenders than "worst of."

Atlantic Record's deal with Sprint to subsidize music distributed on P2P networks, Rhapsody's new search-by-lyrics feature and Japanese operator NTT DoCoMo offering an integrated Napster mobile music solution all deserve "the nod."

But the Plugged prize goes to two separate but related announcements -- Sony BMG's agreement with Last.fm and Warner Music Group's deal with Imeem. Both show how the music industry is making efforts to embrace social networking communities.

I still think the music industry made a huge mistake going after P2P networks as hard as it did. Piracy is growing at an unfettered rate on services right now that make no bones about being outlets for piracy, and in fact, they seem to relish it. Many of the older networks -- the ones sued out of business -- actually wanted to work with record labels to jointly monetize the activity taking place on their networks. Huge missed opportunity.

So it's refreshing that - aside from a few lawsuits -- labels see the opportunity in working with sites like Imeem and Last.fm rather than attempting to shut them down. Of course WMG had to first sue Imeem to get there, but hey, whatever works.

To be sure, we've not seen the end of this trend. Much will be learned over the course of the next 12 months as to what business models and user features prove successful. If I were Napster, Rhapsody or any of the other subscription services, I'd be taking a long, had look at where this is going. If any of these companies can succeed in putting a good social networking and recommendation element over their existing discovery tools, we'd be getting close to the secret sauce we've all been waiting for.

The question is, can they pull it off before the social networking sites replace them?

UnPlugged:

The Wall Street Journal wrote an interesting story about how radio stations are using P2P network download data to determine what songs are hot and then adding them to their playlists.

And in my most recent Digital Entertainment column, I examined the many digital music metrics that may soon be used to influence Billboard's charts other than a la carte sales, including P2P.

In the process I learned that incorporating P2P traffic into any kind of measurement of music popularity is a bit of a hot potato, even if labels themselves are using the data to a certain degree.

Look, good data is good data, regardless of where it comes from. Sure the argument can be made that tracking what people are "stealing" for free isn't as strong a measurement as tracking what people are actually paying for. But I think it's equally telling to determine what people will choose to acquire for free if given the option. And even more importantly -- what they're not.

Here's a thought: Flood P2P networks with a single off the next new boy band album to drop and see if anybody actually downloads it. If users aren't even willing to give it a listen FOR FREE, think there's much sales potential there?
I don't understand why some in the label community feel paying attention to P2P traffic is such an offensive idea. To me, that's just sticking your head in the sand -- hoping the problem will go away.

Piracy is a problem, I get it. But if you can wring at least some positive data out of it, why not take the opportunity? Otherwise you're just adding insult to injury.