It looks like Q-Trax might be dead before it starts. This is a disappointment as I truly believe it could have been a service that was good for the music industry, artists and consumers. In a comment to my article Peter J made some good points about the impact to GNC if its content was available for free (i.e. without GNC advertising) through another source. If this happened it would indeed reduce the return to Todd as the people that consumed the content elsewhere would not come to GNC to see it.
This analogy does not work so well with music though, primarily because music (ideally) is art not information. While they are both to some extent intangible, art and information actually have radically different economic aspects. The value of the information is the information itself, once you have it you have it. While you may look at other sources for confirmation, you only need to be exposed to the information once to gain the full value you can from it. Thus it is important for a blog like GNC to tightly control its content in order to ensure that it receives the economic benefit of that informations consumption.
Art works differently as the value gained to the consumer is in the act of consuming. It is therefore common that repeated consumption will not reduce the joy (value) of consumption. Indeed the better the art the more likely repeated consumption will actually increase the value the consumer gets from the item. This is why record companies are willing to pay radio stations to play their songs, they know that repeated listening will increase the chances of a listener buying the single or album. What record companies actually sell is not the song, but the convenience of listening when and how you want.
Once you realise this it becomes obvious why what the RI is doing is so idiotic. They need to be looking at any way they can increase the amount of free listening that potential consumers can do, striking a balance between this and restricting the methods those consumers can use. Things like the Qtrax service, Internet radio, podcast/vidcast backing tracks are all perfect for this. Then the product they actually sell should be as convenient as possible to allow them to realise the most value. Instead they try to limit interaction with the art at every turn, and try to limit the convenience of the consumer that pays them money to gain convenience.
They are a bunch of morons and their inability to grasp the basic concepts of their product and market is the main reason their profits are shrinking at a time that there is more money being spent on leisure than ever before. RIP big label music, you are about to miss one of the best opportunities to revive your market available and we will all be better off when the small label becomes the force in the music industry again.