The last time we checked in with SpiralFrog, it had made quite a splash by announcing that it would offer the entire catalog of Vivendi's Universal Music Group for free download. That was last summer, and it appears things have gone seriously downhill since then, adding questions to the viability of ad-supported sites that offer free music.
Cnet reported Thursday night that the ad-supported site has shut down and surrendered assets to creditors. SpiralFrog had borrowed somewhere around $9 million from hedge funds last year to keep its business running.
It amounts to some bad news for the venture capitalists who backed the startup with roughly $10 million.
- Olaf de Senerpont Domis
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