Ad-Supported Music Venture Might Foretell a Business Trend

Authored by Scott Goldberg on June 13, 2007 - 1:53pm.

The announcement that Peter Rojas, founder of Engadget, will join Downtown Records to launch an online-only, free music label is a sensible marriage. The label, to be called RCRD LBL, will offer music in an ad-supported format, something industry execs have been discussing at conferences and forums for the last year. But it’s not merely the free music that will help the label find success. Rojas’ ability to create compelling editorial around a label that has a solid reputation for signing cutting edge acts like Gnarls Barkley and Cold War Kids will bring a unique product to the market.

But does it foretell the music business’s future? In some ways it must, as the value of individual songs has been marginalized by the vast selection made more readily available through high speed internet connections. As WiFi continues to penetrate the market, and WiMAX further develops, a ubiquitous connectivity will emerge to give users ample opportunity for free music where ever and whenever they want.

Yet at the same time, can a site with a limited selection quench the thirst for new tunes that music fans are growing accustomed to getting? With many digital music stores offering over 3 million songs, will a handful of exclusive downloads on RCRD represent a compelling spot to spend a great deal of one’s time?

In that regard, RCRD LBL is actually part of a developing trend to filter the sea of content web users sift through. It can be daunting to find quality content on sites like YouTube and MySpace, but Will Ferrell’s new project, FunnyOrDie.com, an online video venture, provides a unique proposition to users: If Will Ferrell approves, it must be funny.

Could the same filtering be done by RCRD? One obvious difference between it and FunnyOrDie is that the latter works well because of the attraction of Ferrell. The same concept wouldn’t be nearly as successful with, say, Adam Sandler at the helm. Ferrell is the comedy guru of the moment. Fans trust his judgment and allow him to hold their hands through the discovery of the site’s offerings.

RCRD will rely on its library and taste to offer the same filter. But with the editorial side of the business in the reliable hands of Rojas, it might not matter that the label lacks a star similar to Will Ferrell. Rojas has created a sticky enough site with Engadget, ranked in the top 5 most popular blogs on the internet by Technorati. To create a blog about the music industry with free exclusive music as an add-on seems like a no-brainer. It might even be a sign of things to come. Hold on to your seats, we’ve inched closer to free legal music.

Scott Goldberg