Thursday, December 28, 2006
SpiralFrog Looking Like a Toad
SpiralFrog was supposed to leap into "free" music downloads this year, but it didn't happen. According to Forbes, the company now hopes to launch at the end of January. SpiralFrog has yet to land the catalogs of Warner Music Group or Sony BMG, so if it launches early in 2007, it will be dominated by smaller labels, which drastically reduces the service's appeal. And as Forbes pointed out, two other alternative music revenue schemes -- Qtrax and Mashboxx -- haven't gotten out of the gate with services even after years of trying. As I've said before and before, this is a bad idea that has almost no chance at becoming a profitable venture. To repeat, the cost that the company has to pay to the copyright holders is higher than any potential ad revenue, you can't transfer the music anywhere, and someone will find a way to hack the digital rights management software. Napster continues to struggle to make a buck with its free and subscription services for streaming music online, which is much cheaper for them and safer for the music industry. Napster lost $9 million during its most recent quarter, which is an improvement over the previous year, but still far from profitability. If anyone could make ad-supported music work, it's Napster.
By John Gartner at 11:59 AM | Comments (2)