THE world’s largest record label is to revolutionise music sales by giving away downloads by artists including U2 and the Scissor Sisters.

Fans will no longer have to pay 79p to download a track after Universal Music agreed to a deal that allows customers to access its entire back catalogue in return for watching advertisements while music is downloaded.

It is the first time a large label has backed a service offering its songs free. The move may pose a threat to iTunes, whose customers pay per track, and Napster, whose customers pay £9.95 to “rent” songs for a month. SpiralFrog, the company which provides the service and has licensed Universal’s catalogue for a year, plans to make money from advertising alone.

Visitors to the site will have to wait 90 seconds for each song to download, and in that time will be encouraged to browse the rest of the site’s content, which includes music news, and gig listings.

If the model is successful, it is anticipated that other labels will follow suit.

“Every music company has to find new and compelling ways of offering music that they can be compensated for,” a source close to Universal said. “Consumers generally like a buffet of options to choose from. Some are hardcore iTunes junkies and will never change. Others like subscription services such as Napster, where they get access to a wider range.”

“This is a third way, where people get music free in return for watching ads. The more ways in which we can provide access to our music in a legitimate way, the better,” the source said.

The site is aimed at the under-35s, and in particular those who use illegal file-sharing services. A report for the International Federation of Phonographic Industries last month indicated that for every song downloaded legally, 40 are obtained illegally.

“We are absolutely confident we’ll be able to make money through ads alone,” Robin Kent, the chief executive of SpiralFrog, said.

“Advertising is moving online at a huge speed. Whether it’s MySpace or YouTube, the internet is where young users get all of their content now,” said Mr Kent, who is also the former chairman and chief executive of Universal McCann, a media buying agency.

Mr Kent said that advertisers would be impressed by data gathered by the site, such as customers’ postcode, age and gender, which would enable it to target adverts more effectively. The site will not sell such information to third parties.

According to the Advertising Association, the online advertising expenditure in Britain last year was £19 billion — up 2.6 per cent on the previous year, but still less than print, television and direct mail.

Analysts said that the “advertising only” model for music download services was feasible, but only if the library of songs were big enough to make users want to visit the site.

“There is a large amount of private equity in this market at the moment, but for a site like this to work it needs to have a wide catalogue, and SpiralFrog will be looking for ways to broaden its scope,” Keith Jopling, head of research at the International Federation of Phonographic Industries, said.

SpiralFrog said that it was in talks with all the other large and independent labels.

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