Sony to launch Net music service

Announced by Sony Vice Chairman Howard Stringer at an event in Paris, the service appears to be conceived as a rival to Apple Computer's successful iTunes digital music store, and as an attempt to stem its entertainment divisions' perceived losses to file-swapping services like Kazaa.

Although details remain scarce, the Sony service as described will be closely tied to the company's consumer electronics and proprietary copy protection technologies. The company did not provide information on pricing or business models, although Stringer did describe it as a download service.

Like Apple's before it, Sony's announcement of an online song sales service is part of a strategy that goes beyond simple music sales. Both companies are trying to make their hardware, from computers to digital music players, the centerpieces of digitally networked homes, and they hope that providing entertainment content directly to consumers will also drive demand for their hardware.

Sony, though, has been in a uniquely uncomfortable position that straddles the entertainment and consumer electronics world. Hamstrung in part by its movie and music divisions' fears of digital piracy, it has seen independent companies jump ahead in development and sales of digital music players, while its own copy protection-enabled devices have had only lukewarm appeal.

Earlier Sony-backed digital music efforts such as subscription company Pressplay--now a part of Roxio's soon-to-be-launched Napster--have not had close connections to the electronics division.

According to information Sony provided, the new service is being developed internally as a joint effort between Sony Music, Sony Pictures, Sony Electronics and Sony Corporation of America. The divisions have been working together on a common infrastructure for network services in the United States, and the new music service will be a part of this project.

Sony Music will provide initial content for the service, but all the major music companies are expected to participate, the company said. Sony Corporation of America will oversee the service in the United States. The service is expected to launch in the United States and Europe in spring 2004, with an earlier launch date set for Japan, the company said.

The company's electronics division will create consumer devices that are tailored to work specifically with the music service, but Sony will also license the underlying media technologies such as the OpenMG copy protection and technical interfaces to other hardware companies. Sony said the service would be available on portable music players, PCs and other audio devices.

The new service is just the latest that's expected from the consumer electronics giant in the coming years, as it prepares to turn up the volume on a broader network strategy, focusing on content that can be distributed to devices all linked to a broadband connection. Sony has touted this strategy, referred to as the "ubiquitous value network" for several years and has been developing products that can connect to a network.

Another example of Sony's networked strategy is its Cocoon digital video recorder, which is currently available only in Japan but is expected to hit the United States later this year. The DVR service is used in a Sony recorder, and subscribers can use a cell phone to remotely program the service to record shows.

With its RoomLink product, a Wi-Fi access point for sharing digital content among consumer electronics devices, Sony has also been laying the groundwork for wirelessly connecting networked devices.

By the time Sony's music service launches, many other online music services are likely to on the market as well. Apple's iTunes, currently available only for Macintosh computers and iPod music players, is slated to expand to the Windows platform late in 2003 or early 2004. BuyMusic, created by Buy.com CEO Scott Blum, is already operating. Other companies, ranging from Amazon.com to Yahoo, are expected to launch their own music stores or resell other services in the coming months.