This one is about a prince turning into a toad.
SpiralFrog became a flag bearer for services that offered songs free of charge while trying to support operations through ad sales. In 2006, The New York Times wrote that the business model was a clever piracy-busting idea. Turned out no self-respecting pirate would go near it. Songs were locked in DRM, and the music library was missing songs from two of the four major record labels. SpiralFrog accumulated more than $40 million in debt by the time the company collapsed in 2009. One frustrated manager wrote: "How do we explain spending $1.5 million in marketing in the month of June when our resulting revenue was $69,711...an oops?"
Talk about customer care: after it closed, SpiralFrog managers enabled former employees to use the customer e-mail list for commercial purposes.
SpiralFrog was a successful harbinger in at least one respect, though. It was among the first ad-supported start-ups to go down in flames. Others have included Imeem and Ruckus.
May 27, 2011 4:00 AM PDT
| Caption by: Greg Sandoval
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