SpiralFrog Aims for End of Year Launch

Wednesday, August 08, 2007

By ALEX VEIGA, AP Business Writer


LOS ANGELES —, an ad-supported Web site that allows visitors to download music and videos free of charge, has begun testing its service with plans to launch by the end of the year.

The New York-based company recently began allowing an unspecified number of users in North America to try out the site, which has about 700,000 tracks available for downloading, said SpiralFrog founder and Chairman Joe Mohen.

The company plans to expand its "beta" test in the coming weeks and will launch the service in the United States and Canada after receiving feedback from users, advertisers and recording labels.

"We're really testing the user experience to make sure it satisfies the needs of demanding young consumers," Mohen said.

SpiralFrog lets users download audio tracks and music videos for free, but requires that they register and log on at least once a month to continue to play the content. Though free, the audio and video files carry copy protections like those found on tracks available for sale at Apple's iTunes Store and elsewhere.

It takes 90 seconds to download a track _ more for a video. During that time users are enticed to browse the site and, its advertisers hope, become exposed to more ads.

"The consumer is paying for the music with some time," Mohen said.

Downloads cannot be burned to a CD, but can be transferred to dozens of digital music players. The content, however, is not compatible with Apple's Macintosh computers or its market-leading iPod.

SpiralFrog aroused interest last fall after it announced licensing deals with Vivendi SA's Universal Music Group, the world's largest recording company, and performing right organization Broadcast Music Inc. But the company missed its early 2007 launch and instead underwent an executive shuffle that ended with the ouster of then-CEO Robin Kent.

Mohen blamed the launch delay on the time-consuming process of obtaining rights from music publishers, who will be getting 10 percent of ad revenues, and the need to expand its data storage and bandwidth capabilities.

"With SpiralFrog we have an entirely new business model," Mohen said. "In most cases we have to clear the publishing rights ourselves, and that takes a long time."

Mohen said SpiralFrog continues to hold licensing talks with other labels and hopes to have a catalog of around 1.5 million tracks at launch.


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