SpiralFrog inks music deal with Universal
Music on the Internet has often been free or legal, but start-up SpiralFrog is looking to offer songs that are both.
The 20-person New York-based company has signed a deal with record label Universal Music Group to offer songs for free, hoping to make money by showing ads to users as they download the music.
“Essentially they are paying with their time,” said Lance Ford, the company’s chief sales and marketing officer. SpiralFrog hopes to begin running the service in December, offering downloads in the Windows Media Audio format. The downloads could be played on the PC or transferred to a portable device, though notably not Apple Computer’s iPod.
Although billed by some as an iTunes competitor, SpiralFrog’s idea is more like subscription services such as Napster or MTV’s Urge. Users are required to go to the company’s Web site each month to validate their music, or else it expires.
This is not the first time that a record label has dipped its toe into offering music that is paid for through advertising revenue. Earlier this month, EMI announced a deal with start-up Qtrax, which is also looking to provide free, ad-supported music.
EMI spokesman Adam Grossberg said the label has been experimenting with a number of different business models, including several advertising-backed music and video services. “Ad-supported delivery of music…provides EMI with a potentially viable new source of revenue,” Grossberg said. EMI has also been in talks with SpiralFrog.
Universal would not comment publicly on its deal with SpiralFrog.
Full article: CNET News.com