With CD sales dropping fast, it is not hard to imagine how the major music labels could benefit from the growth of Web start-ups like Imeem. The company’s service lets people listen to songs, discover new artists and share their favorites with friends. And in return, Imeem owes the labels licensing fees for use of the music.But two months ago, Imeem’s founder, Dalton Caldwell, was ready to pull the plug. While 26 million people a month were using the service, Imeem owed millions of dollars to the music labels, and income from advertising was nowhere close to covering expenses. “It reached a point where it was not even clear it was worth doing any more,” Mr. Caldwell said.
http://nytimes.com/2009/05/28/technology/start-ups/28music.html
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