A profile by the Wall Street Journal's Ethan Smith and a press release in Coolfer's inbox signal the official launch of RCRD LBL, an innovative new label created by Downtown Records and Engadget founder Peter Rojas. The label will offer free, ad-supported music. According to the WSJ, the label has signed up three sponsors thus far: Virgin America, Nikon and Puma.

Here's how RCRD LBL will work: The label will give away free, unprotected downloads of bands it has signed. The label has deals with 40-50 bands to distribute "a handful of songs" from each. Artists get a "modest" advance from the label instead of a share of ad revenues; advances range from $500 for a relatively unknown to around $5,000 for a more established name. The label will split revenue from licensing (TV, commercials) with the artists.

The songs will be downloaded at the RCRD LBL website, which is a basically a souped-up music blog. Though anybody can visit and download music, visitors can create a user account in order to leave comments and create customized RSS feeds. A media player sits in the upper right corner of the site. There are artist pictures and tour dates as well.

RCRD LBL has an "extended family" of labels that will "allow users to download exclusive, promotional and catalogue tracks" from the likes of Ghostly International, Dim Mak, Downtown, Kompakt, Dirty Bird and Warp labels.

In his article, Smith mentioned recent quotes by Pali Research's Richard Greenfield about consumers' belief that music should be free. Yes, some of them do. Now they have a legal alternative to acquire free music -- if they happen to like the music offered by RCRD LBL (read: indie rock and electronic). I believe this new model will be very successful in certain corners of the consumer world. While some people will continue to use terrestrial radio, CMT or NPR to discover music, those who already frequent music blogs for music will give RCRD LBL good traffic. But how much room for growth is there? The key to stardom for this business model is getting middle of the road consumers to visit on a regular basis. I wonder just how much potential traffic exists for music -- even free music -- that lies outside of the mainstream. Revenue from licensing opportunities will be very important.