We live in a world of democratized production. Anyone with a compelling idea can use ubiquitously available hardware and software to create remarkably popular content. Funtwo, for example, has enjoyed over 7 million views of a video he created with a home video camera (one camera position, very few edits). The subject of this video is Funtwo playing guitar in his bedroom.
There are some who will argue that there are no rights issues associated with this particular video, but most people who make a living writing, performing and selling music would disagree. Funtwo is either playing or phantoming (lipsyching with a musical instrument) to JerryC's arrangement of Johann Pachelbel's Canon in D Major. The original song is in the public domain, but JerryC's arrangement is protectable under current copyright laws. Both of these individuals (whoever they may be) certainly have the right to work for free, but let's assume (for the sake of argument) that one or both of them wanted to get paid. How would they do it?
First we must understand the rights they might have under the current copyright laws and common practice business rules.
There are other types of licenses, but these are the most common. Now, let's say that you want to create a piece of video content that includes a music track. Where do you start? Do you have a legal department? How about a music clearance department? No, I didn't think so. Most people don't even know what rights they are violating when they upload or download a piece of music.
As we enter into the year of user-generated content and we start to see big sites like YouTube and MySpace as well as smaller sites like BlipTV start to profit from the sale of advertising around this content, we must create an automated marketplace for aggregated music rights. The computer technology required to create this type of automated clearing house is trivial, but the business rules and negotiations with all of the various rightsholders is not.
Internet distribution at a profitable scale is still in its infancy. We are just starting to see ways to transform value into wealth online. If Chris Anderson's "Long Tail" theory is correct, digital content will ultimately, and counterintuitively, start to sell under the 20/80 rule (as opposed to the classic Pareto 80/20 rule that currently governs most sales curves on or offline.) Now would be a great time to get out ahead of this explosive math problem, before it actually explodes!