Universal Music enters agreement with SpiralFrog for free music downloads

Universal Music enters agreement with SpiralFrog for free music downloads

	Published : Wed, 30 Aug 2006 09:45 By : Paula Demarzio Print this Story

LOS ANGELES - In a move designed to skittle the progress of Apple's iTunes, Universal Music, the world's largest music catalog holder, has decided to license all its songs for free downloads on SpiralFrog.com. The Web site, which is based in New York is still in testing stage and is expected to debut next year.

All songs will be legally available for free and SpiralFrog is hoping that advertising revenue would be enough to get users back onto the site. "Offering young consumers an easy-to-use alternative to pirated music sites will be compelling," said SpiralFrog CEO Robin Kent.

"SpiralFrog will offer those consumers a better experience and environment than they can get from any pirate site." All the music files will be in Microsoft's Windows Media format and be protected by its integral digital rights management technology. This should "provide peace of mind for the record labels and the artists," Kent said. Universal artists include U2 and Kayne West.

All songs are free for download, but users must view a 90 second advertising sequence before the download starts. Also the songs can be played on either PCs or portable music players bearing the PlayForSure logo. "Offering legally authorized audio and video downloads in an advertising-supported environment works, as our business model is based on sharing our income streams from that advertising with our content partners like Universal," Kent said. However the service will not work on Apple Computer's Macintosh computers or iPod music players.

"If someone wants to buy a million CDs from us and then give them away on a street corner, that's fine with us as long as we get paid," said Larry Kenswil, an executive at Universal Music. "Anything that encourages people to get music from legitimate sources is a good thing."

SpiralFrog will pay an upfront amount to Universal as well as a share of ad revenue.
Analysts say this move is a potential blockbuster. Gartner Research analyst Mike McGuire told Reuters that the only doubt was whether there was enough ad revenue.

"The challenge is going to be whether there's enough advertising revenue to drive sales volume. And as we know in online music, if you don't have all four of the majors [Sony BMG being the one not yet mentioned] plus a significant number of independents then you don't have a thriving store."