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Free All Music to offer free MP3s, new ad model

Atlanta-based start-up believes that users will be willing to watch a short video advertisement in exchange for a free MP3 download.

Free All Media, an Atlanta-based start-up, is the latest company to propose an ad-supported music downloading service. The company, which just announced its first seed round of funding Wednesday and expects to begin public beta testing by December, hopes to differentiate itself from flameouts like SpiralFrog with a unique advertising model that asks users to participate more directly in choosing the ads they'll see.

The company's CEO, Richard Nailling, explained how the company's Web site, Free All Music, will work. Users will select an MP3 they want to download and a sponsor they'd like to "buy" that MP3 for them. They will then watch a video advertisement, between 15 and 18 seconds in length, from that advertiser. Once the ad is completed, they'll be free to download the file, a 256kbps MP3 with no copy restrictions. No further advertisements will be served for that download.

But here's the unique part--Free All Music will then use the downloader's handle in other banner ads for that sponsor, which Free All Music will place around the Web using an (as yet undisclosed) third-party ad network, as well as through its own ad network, which will focus on music-oriented sites. In other words, you might be visiting CNET and see "MattR just downloaded 'Angry Chair' by Alice in Chains...sponsored by Converse." In this way, Free All Music will be able to sell multiple ads per download and perhaps earn enough money to cover the license fee for each song.

There's a catch, of course: users will only be able to download as many songs as Free All Music can sell sponsorships for. At launch, the company is aiming for what Nailling calls "typical iTunes behavior," which is 15 songs per month, spread over three sessions. If the site takes off and advertisers buy more space, the song allowance will increase.

The key to success will be whether the company can get all four major labels and enough indies on board to make for a competitive selection of music. So far, the company claims it's signed up one major label (unnamed), and is aiming for the "full digital catalog" from each label, giving it full parity with iTunes and sites like Amazon MP3.

Would you be willing to sit through an 18-second video ad in exchange for a perfectly legal and guaranteed legitimate MP3? Or will you stick with file-trading networks?

Correction at 7:13 a.m. PDT October 1: This post incorrectly stated the number of free songs that Free All Music aims to offer at launch. The site plans to offer 15 free downloads per month, spread over three sessions.