Universal to try ad driven music downloads through SpiralFrog – still with DRM

If you’re familiar with this story, see the updated details at the end. Universal Music, the corporate parent behind labels like MoTown, Geffen Records and many more, announced this morning that they will be making their entire catalogue available for free download through New York based startup SpiralFrog.com starting this fall.

SpiralFrog will offer free downloads wrapped in a still undisclosed form of digital rights management technology. How tired. Executive bios indicate the company has been around for more than two years, but we’ll see if they were doing anything more than lining up big names for their corporate roster, music partnerships and advertisers for the site. How about coming up with some workable alternative to the pathetic state of DRM with two years of work?

Music lovers have been demanding a different business model for some time, and it looks like at least some industry heavy hitters are going to give it a go via SpiralFrog. We’ve profiled several independent sites experimenting with new business models for music lately (Amie Street, Sellaband and Magnatune) but you had to expect the big guys to try something more traditional. See also eMusic, low cost and DRM free.

The CEO of Spiral Frog, Robin Kent, was former CEO of advertising firm Universal Mccann. Their CTO, Vesa Suomalainen, was an executive at Microsoft for 12 years. SpiralFrog’s management and directors is made up of a long list of big media execs, like Frances Preston (former President and CEO of BMI) and Jay Berman (former Warner representative to the RIAA). SpiralFrog told the Financial Times that they were in talks with Warner, EMI and Sony-BMG as well. This is clearly big media’s attempt to try free downloads driven by ads, but it’s still caught up in DRM!

Is there any chance that the ads will generate enough revenue to cover the costs to be incurred? Perhaps if the site is high profile enough there is. High end clothing retailer Perry Ellis is already lined up to advertise on the site. Sounds like a gamble to me, but we’ll see.

Update with details: I just got off Skype with the fantastic Neville Hobson (see FIR), who’s doing PR for Spiral Frog. He wasn’t able to convince me that this was really a compelling service, but he did provide some juicy details.

Spiral Frog will offer a desktop downloader for Windows Media Files (no iPods!) that can be listened to on one PC and two portable devices. Here’s the kicker – you must log in to the Spiral Frog service at least once per month, and see their ads, or your files will stop playing! The details aren’t fully set in stone, but it will be something like that. There will be links to third party sites of the record labels’ choosing if you’d like to buy your freedom to at least skip the ads.

Spiral Frog will also offer far more than just music, but also video and other digital content. The selling point here is that users will be able to access media legally, without the malware, bad network connections and pirate’s shame that comes from other online media sources. Weird Al’s new “Don’t Download This Song” must be linked to in reference to those arguments!

It will be an exciting day if the major labels come up with something truly more compelling than piracy on one hand or coercion on the other – but I don’t think this is it.