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MP3 Players

Sky to launch music download business with Universal

Universal Music Group and Sky are teaming up to form a new business that will offer DRM-free downloads of music, along with an unlimited streaming service, on a monthly-subscription basis in the UK

Sky is to launch a DRM-free music subscription download service in the UK, combining unlimited Web-based streaming with limited numbers of DRM-free downloads, for a monthly fee.

The service is backed by a single major record label -- Universal -- that is said to be offering DRM-free MP3 downloads, meaning they will play on almost any device in the world.

What's particularly interesting is that Sky and Universal are forming a new business together to market the service, in which Sky will be a majority stakeholder, Universal a minority.

No other major labels are currently involved, but other labels will be offered 'a stake' in the company, after which their music will be made available for purchase.

On the surface, the new service appears to be something of an amalgam of the business models behind eMusic and Last.fm. eMusic offers a monthly subscription service that gives access to fixed numbers of downloads from independent labels' music for a set fee. Conversely, Last.fm -- a product of Crave's parent company CBS -- lets users stream major label music for free, but users must listen online and cannot download songs to MP3 players.

More interesting still is that neither iTunes -- the largest online music download store -- has DRM-free deals in place with Universal, nor does DRM-free-lover 7digital.com, which has DRM-free deals with EMI and Warner.

This is not the first time Universal has ventured into new territory, however. In the US, Universal offers its catalogue to Amazon.com's MP3 store -- a service known to be on its way to Europe this year.

Universal is also in business with Nokia to launch the Comes With Music download service, that offers unlimited downloads to users of certain Nokia handsets.

As far as the service's chances of success are concerned, we're not holding out a great deal of hope. It's nothing to do with the saturation of the market, but more to do with the fact that the majority of users -- particularly younger ones -- don't care what label owns which music; if their favourite band doesn't show up as available, they won't go back. That's what will likely happen unless Sky gets at least all the other major labels on board -- possibly some independents, too -- if they want to offer a comprehensive service. Otherwise it's all aboard the failboat.

No launch dates or prices are available at present. Neither are details on whether Sky plans to host the service solely on the Web or whether it'll be available through the Sky set-top boxes or as part of broadband packages. -Nate Lanxon