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Real cues 250,000 music subscriptions

The rise in members is a sign that the music subscription model is slowly catching hold, even as pay-per-song models such as iTunes gain more attention.

Digital media services company RealNetworks is providing a look at exactly how many people are tuning in and paying up for its subscription services.

As part of its quarterly earning call, the company said that it had more than 250,000 paying subscribers. That figure includes the $10 per month Rhapsody music service, which provides unlimited access to the company's music catalog, and a RealNetworks Web radio service that's $6 cheaper.

Those aren't figures that will make the ailing music company jump immediately out of its sickbed, but they are a sign that the music subscription model is slowly catching hold, even as pay-per-song models such as Apple Computer's iTunes gain more public attention. The momentum appears to be growing, moreover. RealNetworks Vice President Shawn Ryan said that the total subscription figures had grown by 46 percent since last quarter.

"What we're seeing is strong growth across the music line," Ryan said. "I think this is part of a broader trend on the Net towards paid content--from people saying, 'This isn't something evil after all.' It's not something you would have heard a year ago."

The rise in spending on music online is happening on several fronts, driven by the rapid growth in availability of record label- and artist-authorized services and in part by increasingly stringent antipiracy enforcement efforts by the record industry, including lawsuits against hundreds of individuals accused of offering files for download online.

Numbers like RealNetworks' Rhapsody figures are trickling out from several companies. Apple, which has set a goal of selling 100 million songs through its iTunes music store, said it sold 1 million tracks to Windows users in just the first three days of its PC-based service.

Earlier, Musicmatch said it had more than 150,000 paying subscribers to its Net radio service. That company recently launched its own pay-per-song music download service. Emusic, which was recently sold to a New York-based equity group, had more than 70,000 paying subscribers. Napster, owned by CD-burning software company Roxio, will launch its own subscription and download service on Thursday.

The rise in RealNetworks' figures last quarter were largely driven by subscribers to the full Rhapsody service, which has gained substantial visibility with distribution through the Real.com Web site and inside Best Buy retail stores, Ryan said.

Ryan said Rhapsody will begin selling downloads of individual songs to non-subscribers, competing more directly with iTunes, beginning by the end of the year.