As part of our ongoing quest to examine the intersection of media and monetization, I met with Trey Shelton, Founder and CEO of Music Interactive, to discuss the company’s new service that allows viewers/listeners to trade their time and attention for free content.

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Trey founded Music Interactive in 2005 with the express purpose of creating new opportunities to bring together the advertising and music worlds and I think he’s found a nice way to mix the revenue opportunity of advertising with the rich media of music.

The service works like this. A major site, like MySpace, and a major advertiser, like Microsoft, want to run a promotion involving music. They line up an artist who also wants a lot of promotion and Music Interactive to provide the infrastructure for offering fans a free download in exchange for their watching a short video about the Zune.

Now we have a five way win. The consumer gets free music, MySpace gets some advertising money, Microsoft gets lots of attention, the artist gets huge promotion and Music Interactive gets a share of the ad spend.

Here are some screen shots of the service in action. In the first, I’ve added a big red arrow pointing at the ad for a free Jon Forman mp3 in exchange for “checking out the Zune”. The next two shots show the pop-up that plays the video and the download of the mp3.

It’s great to see this kind of innovation that creates win-win solutions for everyone involved.

In addition to MySpace, Music Interactive is working with Dodge, Hyundai and Ray-Ban on interactive music promotions.

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