Sonific, the Web based music distribution system that brought you SongSpots, is set to close on May 1. Sonific worked by allowing users to embed 'SongSpots' in Web sites, individual flash widgets that play individual songs on demand. The service targeted social media sites and bloggers who could augment their sites with tracks without additional software or servers.

In a statement on the Sonific Web site, founder Gerd Leonhard, said that the economics of the music industry made it impossible for Sonific to continue with its current business model. Leonhard pointed to the attitude of major labels as one of the key issues in developing the service, noting that the Majors would often make unreasonable demands to license their music, 'we have routinely faced demands for very large cash advances and fixed per-stream minimum payments, pressure to give them 'free' company equity, and requirements of utterly bizarre usage restrictions.'

According to Leonhard the site had around 80,000 registered users and had managed to aggregate over 200,000 songs from independent labels and music aggregators, but had found it difficult in the current business environment to carve out a realistic business model for the service.

According to Leonhard's statement 'the bottom line is that this industry is certifiably dysfunctional and that we do not see a plausible path to take at this time. We neither want to engage in so-called copyright infringement nor do we have millions of dollars available to buy our way in when it is abundantly clear that doing business under the existing rules of the major labels will simply amount to economic suicide.

Sonific, the Web service that creates SongSpots, embedded music streaming widgets that can be inserted into most Web pages, blogs or community sites, has just launched a new angle on the application - a music network that will allow bands, songwriters and labels to upload their own music.

Since its beta launch, Sonific has shown itself to be a pretty cool web app, but the service suffered from a serious lack of content. Although Sonific signed up hip labels such as Cooking Vinyl, Ninja Tunes, V2 and Nettwerk, its catalog didn't quite have the breadth necessary to give the service mass market appeal. The new network features might well prove to be a savior for Sonific, adding both content and an army of users who will promote the service as they promote their music.

Sonific CEO Gerd Leonhard compared the new networked service to the massively popular community generated video sites such as YouTube and Revver, saying that the Sonific Network would be able to democratize music distribution:

Music production and music distribution have already become democratized because of new, disruptive technologies, and now Sonific.net will democratize music promotion, as well. Just like any visual content creator can already virally distribute his videos via YouTube, Revver or VideoEgg, a record label or artist can now use Sonific's SongSpots platform to make their music widely available as a full-length audio stream that can be embedded into any website -- the power of content syndication is finally available at a click of the mouse.

Given the recent storm of controversy surrounding the unauthorized uploading of content on YouTube, the launch of the Sonific Network means that Sonific now needs to navigate the legal minefield associated with user-generated content. Speaking to DownloadSquad, Leonhard said that, since the registration process for users was fairly detailed, filtering for unauthorized content would be done on a manual basis. That said, the company is in the process of investigating technology that would allow for automated content filtering.

SongSpots can already be embedded into most major Web community sites, but Leonhard said that Sonific was working on new developments that would provide for further integration and new features including a facility to allow for the use of the widgets for podcasting.