Peter Gabriel on download project We7: "Throw it at the wall and see what sticks"

Photograph: Felix Clay

John Plunket, guardian.co.uk, Tuesday November 25 2008

Peter Gabriel: 'Twenty years ago, the thought of encouraging advertising with music would be like offering your daughter to the devil.'

It is emblematic of the challenges facing the music industry today that Peter Gabriel earned more money from a compilation CD given away free with the Mail on Sunday than he did from the sales of his last record, the million-selling Up.

"It was given away to charity," said Gabriel of the proceeds from last year's Mail on Sunday giveaway. His pained expression suggests he is not a regular reader of Peter Wright's paper. "No, I won't make a comment about the newspaper involved."

It was also the Mail on Sunday that infuriated the beleaguered record industry - but wowed marketers - by giving away nearly 3m copies of the latest Prince album, Planet Earth. Did it worry Gabriel? "No, I think everyone should try all sorts of stuff. Throw it against the wall and see what sticks."

The former Genesis singer has thrown a portion of his own fortune into a new online venture that will also give content away for free.

We7, which launched earlier this month, positions itself as an "easier and better alternative to piracy", is an advertising-funded service that allows users to download songs for free. The catch is that each song has an advert tagged to the front of it.

Ads are both the bane of commercial radio and its lifeline, with listeners preferring the clutter free BBC. So how will users cope with the prospect of ads interrupting their iPod?

"It's a big hurdle," admitted Gabriel. "Twenty years ago, the thought of encouraging advertising with music would be like offering your daughter to the devil, but I think the reality is that people have got used to free music, and this is one of the few ways that musicians can still earn in a free music environment."

Technology has moved on in the 22 years since novelty "cyberpunk" band Sigue Sigue Sputnik put ads for L'Oreal and i-D magazine in the gaps between tracks on their album, Flaunt It!.

We7 will offer targeted ads based on information volunteered by its users, with an average of two minutes of ads per hour of music.

Around half of We7's 2 million songs are available for free download. The other half - the ones licensed by the four major record labels - have to be paid for. But users can stream all the songs for free - again, with ads attached. "People hate ads but they love free better," said the We7 chief executive, Steve Purdham.

Gabriel has long pioneered new digital music technology, from the Eve and Xplora interactive CD-roms in the 1990s - hilariously clunky-looking today but ground-breaking at the time - to OD2, one of the first online music download services which he co-founded with Charles Grimsdale, who is also a backer of We7.

However, his enthusiasm for all things digital - not to mention the Womad music festival, his Real World studio and record label and the Elders, the group of 12 statesmen and women that Gabriel convened to help deal with global problems - means there is little time left for his own recording career.

Gabriel's next record has been funded by Patrick McKenna, the chairman of the Ingenious Media Group and Gabriel's former financial adviser. But he may have to wait a while to see a return. Next year, perhaps? "Hopefully there's something," smiles Gabriel. "But who knows?"

He is an investor, not an inventor, he pointed out, unlike his father. "My dad was an inventor, an electrical engineer, so I'm attracted to it and I am fortunate enough to work with some very smart people," said Gabriel.
"I watched my dad trying to sell something called dial-a-programme for about 10 years, a cable-based, entertainment on-demand electronic democracy home shopping [service]. But it was 1971 and he got nowhere. He was stuck with one English company who didn't think people would ever pay for television." How times change.