Universal To Offer Free Ad-Supported Music & Video Downloads

In a move showing that it's willing to explore some alternatives, Universal Music is partnering with SpiralFrog, a startup that will offer free ad-supported music and video downloads beginning in December in the U.S. and Canada.

According to PaidContent:
Universal is making its entire catalogue available for the service, and will split revenues from contextual advertising with SpiralFrog.

One advertiser that's interested is Perry Ellis:
“We believe SpiralFrog will deliver an audience we highly desire and need to reach,” said Oscar Feldenkreis, Vice-Chairman, President and COO at Perry Ellis International, Inc. “Our audience is heavily into music and can be more easily reached on the web. We see SpiralFrog as an ideal place for us to communicate and build lasting relationships with our core audience and which give us unique new revenue opportunities.”

CMedford at Red Herring suggests that this move would allow for an alternative to RIAA aggressiveness and to Apple's domination of the download market.  Although, I'm not convinced that this will resolve the issue of filesharing, it does potentially shift a lot of power back into a major label's hands.

An analyst expressed concern that there was no upsell announced:
“At first sight, SpiralFrog does not appear to have any plans to upsell a premium service to the end-user,” said Michele Mackenzie, an analyst with Ovum. “In our view the key value of the advertising model lies in using it to transition users to paid-for services.”

I think offering a premium product of some sort is certainly a good idea but the hot news is free ad-supported music and video downloads from Universal and the possibility that other major labels will follow suit.

Official site: SpiralFrog

Update:
SpiralFrog will use PlaysForSure digital rights management that was recently cracked.  EMI is rumored to be in talks with SpiralFrog.

Update 2:
Apparently there are a variety of oddities emerging in the SpiralFrog story.