They call themselves Mercora, they call themselves a legitimate digital music downloader, and they've got $5 million in financing to launch what they call a legit alternative to peer-to-peer file swapping.
Mercora’s Web radio station, which is financed by Norwest Venture Partners, has arranged an intriguing method that brings users and digital music together without the legal grappling surrounding conventional P2P – and without allowing song downloading onto a user hard drive. “It is a network of radio stations that is basically converting your PC into a Webcasting station in compliance with copyright laws,” according to co-founder Srivats Sampath, who said Mercora makes each user a broadcaster and their playlist a channel.
In other words, a user can play his own CD collection on Mercora or listen to music from Mercora's large song bank. At that, Mercora claims over 300,000 users playing and listening to about 21 million songs.
"The consumer appetite for digital music is exploding, and Mercora is playing a major role in accelerating this market," said Norwest venture partner Jim Lussier, announcing the financing. "By offering unrivaled music selection, engaging community features and superb quality sound, Mercora has created a unique and compelling user experience that hasn't been possible until now.
"Mercora also harnesses the enthusiasm surrounding peer-to-peer networks in a manner that abides by the letter and spirit of copyright law," Lussier continued, "ensuring that artists and labels are paid while giving music lovers complete confidence and control in the unlimited discovery and enjoyment of music."
The financing deal includes an agreement that Lussier and Norwest managing partner George Sill would serve on the Mercora board.
"We are very excited to partner with Norwest Venture Partners on this incredible opportunity. NVP brings a lot of the traits we were looking for in an investor-high intellectual bandwidth, high integrity and a track record of success in helping build great companies," Sampath said. "We look forward to working with NVP in building the next generation of music search and discovery- IM Radio."
Mercora, founded in 2003 and having its own bank of 7.5 million songs, got a license for non-interactive sound recording streaming from Sound Exchange, the group collecting and distributing royalties to copyright owners and artists – a seventh of a cent every time a Mercora user listens to a song or track.
