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Qtrax, a startup site touted as the world’s first legal and free P2P music file-sharing service with more than 25 million songs in its catalog, has taken a nosedive from revolutionary to a total wreck.

After excessively spending £500,000 or close to $1 million to promote this ad-supported music download service, the company forgot to seal one crucial deal – the support of the record industry. The four major record labels EMI, Warner, Sony BMG and Universal all informed Times Online that there no firmed up agreements with Qtrax. Universal and Warner both confirmed its ongoing negotiations with the startup site.

As expected, Qtrax CEO Alan Klepfisz downplayed the issue, claiming they are already in talks with these record labels but disclosed that the “ink hadn’t dried” on some deals.

We are not idiots. We wouldn’t have launched the service in front of the whole music industry unless we had secured its backing. We feel we have been unfairly crucified because a competitor tried to damage us. Everyone is very upset.

I say, give the man a chance to salvage his reputation! The concept of a legal P2P is too innovative to let go easily. It is just unfortunate that his mouth is faster than his acts. Klepfisz should have been wise enough to shut up and lay low until he secured the much needed backing from this industry.

Read [Times Online]