Muxtape Defense Could Cost $2 to 3 Million

Information’s emerging on the shutdown of Muxtape.

The RIAA’s been watching Muxtape for awhile though they haven’t mentioned users so far that I’ve heard.

But here’s a nice business detail.

Fred Von Lohmann, a "senior intellectual property attorney at the Electronic Frontier Foundation", says they may have a "strong legal defense" as a "’safe harbor’ for sites that host material on behalf of users, which is the same defense used by sites like YouTube."

Problem is, it costs a lot.  Fred says that such a case could typically incur legal fees of $2-3 million.  That’s a high cost for a service without much in the way of revenue streams:

"There are several things I’m working on. One thing I added recently was Amazon affiliate links, and the conversion rate has exceeded my expectations. People are buying music they’re discovering on Muxtape, which is exciting. I haven’t totally ruled out ads, but for now I’m focused on ways to generate revenue that are more harmonious with Muxtape’s nature and purpose."

And that’s exactly what many web 2.0 pundits would have told them to do.

Hey, they could always set up a tip jar!