Music labels tap downloading networks to follow the latest trends

"The record industry has always been more about vibe
and hype," said Jeremy Welt, head of new media for Maverick Records in Los
Angeles. "For the first time, we're making decisions based on what
consumers are doing and saying as opposed to just looking at radio
charts."

One company, Beverly Hills-based BigChampagne, began mining such data from
popular peer-to-peer networks in 2000 and has built a thriving business
selling it to recording labels.

The company '” which takes its name from the Peter Tosh
song lyric, "You drink your big champagne and laugh" '” taps directly into
file-sharing networks like Kazaa's FastTrack. It checks on how often its
clients' artists show up in searches or how frequently their songs are
downloaded. The data can be sorted by market or geographical
region.

The bountiful market research is gleaned from behavior
for which the music industry otherwise shows no tolerance. Hurt by a
three-year decline in music sales, the industry has sued the major
file-sharing networks, along with individuals who have used
them.

BigChampagne has certainly done well by file-swapping.
It formed in July 2000, just as the Internet boom was beginning to bust,
and now counts Maverick, DreamWorks, Warner Bros., Disney and Atlantic
Records among its clients. All the major labels have worked with
BigChampagne "in one capacity or another," Garland said.

BigChampagne doesn't identify individuals or gather
usernames, Garland said. But by analyzing users' numeric Internet
addresses, BigChampagne can still pinpoint location and give clients a
sense of where an artist is most popular.

By using BigChampagne, labels can release a song to
radio and, if there are signs demand is brewing on the song-swapping
networks, immediately make the single available on online retailers like
Apple's iTunes Music Store, Welt said.

The music industry's appetite for data is only growing
as online sales begin to replace CDs.