Dec 22, 2009
The Atlanta, GA.-based FreeAllMusic.com enters a hyper-competitive online music space with an intriguing business model. Instead of charging users a subscription fee or a per-song fee, the site allows users to listen to music for free, with no digital strings attached. And unlike the increasingly common ad-supported playlist model popular on sites like MySpace—which lets fans stream multiple songs for free-- FreeAllMusic.com’s sponsors allows users to download and own songs permanently.
To get free songs, users register at FreeAllMusic.com, find songs they want to download, and then pick an advertiser they want to pay for their free song. Once they make that choice, the user is required to view an 18-second pre-roll ad from that sponsor while their song downloads (brands can also opt to run display ads within the site’s download screen). Once the pre-roll spot is completed, users can then do whatever they’d like with that song—including listening to it on whatever device they’d prefer, including iPods.
Users can also share their free songs with friends, who must also watch that sponsor’s ad. FreeAllMusic.com is testing just how many free songs each users can download at a time, starting with between 15 to 20 songs each month, with a maximum of five per site session.
However, there is a catch to all this—at least for some users. As part of its sponsorship packages, FreeAllMusic.com purchases inventory on various ad networks, and runs corresponding display ads which promote the fact that individual users have recently downloaded specific songs.
For example, a co-branded banner ad along the lines of “Mike S. just downloaded Air Supply’s ‘All Out of Love’ courtesy of LG” might appear on certain music site. Each advertiser is promised 150 impressions of this nature per download; users can opt out of having their personal music habits broadcast across the Web.
Besides Coca-Cola, Warner Bros. Television and Lionsgate, FreeAllMusic.com has signed on Zappos.com, LG mobile phones, and the movie theater concert distributor Inconcert3D as charter sponsors of the still-in-beta-property.
Officials at FreeAllMusic.com said they expect the site to launch publicly in early 2010.
events this year that cast doubt on the viability of the free ad-supported music model, but at least one upstart company thinks it can buck the trend. FreeAllMusic, an Atlanta-based startup, entered private beta today with a model that gives consumers free MP3 downloads in exchange for watching visual ads from sponsors who pay for them — and it’s already convinced two major labels to come on board.
I spoke with CEO Richard Nailling this afternoon, and while he acknowledged that the free ad-supported music arena “is a bloody space,” he believes FreeAllMusic is easier for consumers — and provides more guarantees for advertisers — than SpiralFrog, its closest antecedent. For now, the company is allowing consumers to choose a visual ad from amo
ng up to a dozen advertisers, but brands may be able to associate themselves with artists and songs eventually. Once an ad is chosen, FreeAllMusic broadcasts more banner ads elsewhere around the web that include the downloader’s screen name and the sponsoring brand; Coca-Cola, Warner Bros. Television and Zappos.com are among the early advertisers.
I’m naturally skeptical of a new company so similar to one that perished so recently, but Europe’s We7 has persisted with another related model with some success, and FreeAllMusic doesn’t have any of the DRM-related entanglements that dogged SpiralFrog. Still, people are generally loath to jump through hoops to acquire music, especially when it’s still so easy to acquire it for free without sitting through ads. And I don’t think anyone will be too enthusiastic about his screen name appearing in banner ads all over the web.
The company hasn’t disclosed which two major labels it’s signed up, although Nailling said each is providing its full digital catalog, as is one independent label. He added that FreeAllMusic completed a seed round this fall and is currently raising a Series A round, with emphasis on strategic investors rather than VCs. And while Nailling said the company will take steps to avoid growing too fast at first, such as capping downloads at five per week, its private beta is set to open up sometime early in 2010.
FreeAllMusic, a new site that will offer mp3's in exchange for watching a single video commercial enters private beta today, December 22nd.
There is no software required and once a user chooses a brand to sponsor their download, that brand owns every part of the download process, which includes video advertising, through to the download into their offline music library.
During the private beta, the company is testing offers of 15 to 20 free downloads per month, five per user session, starting every New Music Tuesday, based on the usage patterns of a typical “hits-oriented” iTunes customer. Brands supporting the beta include Coca-Cola, Warner Bros. TV, Zappos.com, Lionsgate fillm Daybreakers, LG mobile phones and Inconcert3D.Public public beta is expected to start some time in January 2010. Free All Media, LLC is headquartered in Atlanta, GA, and with sales offices in New York and Los Angeles. Richard Nailling is CEO and Brian McCourt is the Executive Vice-President of Business Development and Affiliate Relations.