Riding on its initial success, BitTorrent (which claims 170 million monthly users) aims to monetize these bundles within the next few months. In the current model, some content is free to download while additional content is accessible only through a "gate" that downloaders can unlock (typically by submitting an email address). Soon, artists will be able to implement a "pay gate" to their bundles, enabling content creators to charge for the content compilations. BitTorrent plans to take a 10% cut from these pay gates.
While the term 'BitTorrent' has been associated with music and movie piracy for years now, it's crucial to understand the difference between BitTorrent, Inc. and the open source file transfer protocol known as BitTorrent. While the latter powers rampant piracy through torrent indexing sites such as Pirate Bay, BitTorrent, Inc. is a separate entity that uses the BitTorrent file transfer protocol for legal purposes.
Billboard spoke with BitTorrent's chief content officer Matt Mason — who also has penned "The Pirate's Dilemma," a book about understanding and competing with piracy — on the inspiration for the BitTorrent Bundle, marketing the service, partnering with labels, pay gates and why they’re not responsible for piracy on BitTorrent’s open source protocol.
Billboard: BitTorrent began a decade ago as a technology company that developed the BitTorrent peer-to-peer protocol as a way to transfer data. Why has the company delved into working directly with the music, entertainment and other content industries?
Matt Mason: When I joined, Eric [Klinker, CEO of BitTorrent] said to me that the thing he felt was the most valuable thing we could do was build a technology for the entertainment industries that went with the grain of the internet. One of the core tenants of BitTorrent and one of the core guiding principles of the internet when the internet was first conceived was 'put the end user in control.' The internet that artists have today is not what they were promised. We've got YouTube shutting the door on independent artists. We've got Spotify becoming Clear Channel. We've got all of the majors giving up on selling music directly. There's just absolutely nowhere to turn. This is something that has become more apparent as we've been building our bundles, which is why I think we've seen so much interest both from fans and artists in the last year.
How have you developed relationships with artists and labels?
The same way that everybody develops relationships. I came into this business with a set of relationships. We've got a lot more now because people trust us, people see what we're doing and people understand our intentions. There's not a label or studio where we [haven't] talked to at least a few people. Yes, some people, when they met us, they're skeptical. They didn't understand what BitTorrent is. But once people see what we're doing, what we're building, once they meet the people who are passionate about doing good stuff for content creation, they work with us.
What do you see the value added of the Bundle platform over other services (such as iTunes and Amazon) selling similar types of deluxe packages?
iTunes and Amazon kind of feel like Best Buy. They're not really geared toward to just letting the artist publish their creative work in the way that they want. We're trying to build an independent record store — a place where you can go and get lost in a piece of content. iTunes was built by Apple for the major labels and it's focused on selling singles. If you look at the artists using Bundles, yes they want to sell singles. But, they're more interested in building a direct connection with the fan that they can continue to monetize in a sustainable way. If we can build the right direct-to-fan set of publishing tools here, where artists configure the bundle to their business model and put it in front of a large audience, we can create something truly revolutionary.
Can you explain how the pay gates will work?
It's going to be super simple. An artist, content creator or publisher will be able to put some content in front of that gate and some behind that gate, and they will be able to set the price that the consumer has to pay in order to open that gate. The big idea here is that everybody else on the internet that built a store has put content inside that store. What we're trying to do with a bundle is put the store inside the content. So, everywhere that bundle travels -- whether it's embedded in a blog or on Facebook -- wherever it travels on the internet, whenever someone opens that file, they'll get some valuable stuff for free and then they'll have an opportunity to pay for some more stuff.
So far, all of the bundles have been free. Why do you think that people will buy them?
If you look at all of the ways that projects have monetized within BitTorrent, we've been able to drive album sales, box office sales, DVD sales… we've driven all kinds of social and fan engagement. Every single bundle that we do, on average, 1 in 4 fans that downloaded the bundle shared the fact that they downloaded that bundle on Twitter or Facebook. Fans are starting to understand that bundles are this small direct connection to artists, which makes them actually compelled to share and support that content.
Do you anticipate the BitTorrent Bundle to be a competitor to iTunes, Amazon, Spotify and other services?
We think that it will. It's really up to the artist, right? If you're an artist and you decide that you're disgruntled with Spotify and iTunes and you decide to use Bundles and it works for you and you shift all of your traffic and engagement over to the Bundles platform, then in that situation it's a competitor. If you start off with Bundles, and then you embed a Spotify button so that people can go and subscribe to your stuff there, then it's an additive service to Spotify. In the end, it's about putting the control in the hands of the artist. Yes, we're trying to sell ourselves so that we can be a competitor to everyone else in the business, but if stuff's working for artists, who are we to say 'No, you've got to do this here.'
BitTorrent still has a reputation primarily as a illegal file sharing site. What are your strategies to market the service as a paid, legal, online music outlet?
We've talked to people one-on-one. We talk to the music industry, the film industry, publishers, authors. We know that the perception is changing because there are a lot more people talking to us. They have no misconception of who we are. They understand the difference between BitTorrent the company, where it's literally impossible to get any illegal content (and it always has been), and piracy sites which may or may not be using BitTorrent technology on the backend. Piracy sites use BitTorrent because it's the best way to move data, and because they can. It's a page of code that's been open sourced for over a decade.
Does BitTorrent feel a responsibility to decrease the usage of the BitTorrent protocol for piracy?
We're not responsible for that. I came to work at BitTorrent because I think that the best [option] is to build a service where you can have an impact on piracy. The more important thing is creating a fair, democratic marketplace for connecting content creators direct-to-fan. I work here because this is the only place that I can do that. What happens on the Pirate Bay has absolutely nothing to do with us. Why this makes sense for us strategically as a company is because everybody wrongly blames us for piracy. If bundles work, then people will understand that we're a technology company that enables the transfer and distribution of content. That's what we are. If bundles work, it helps us as a company.