Yahoo Unveils Music Subscription Service
2005-05-10 11:32:00
Yahoo Inc. on Wednesday plans to launch in beta a music-subscription service that''s likely to put the heat on rivals offering similar, but more expensive, rent-a-tune services.
The Sunnyvale, Calif., company''s Music Unlimited will offer access to the portal''s million-song library for $59.88 for a full-year subscription, or $6.99 for a monthly subscription, company officials said Tuesday. The service lets subscribers play an unlimited number of songs on their PCs or MP3 players. The songs, however, can''t be played if the subscription expires.
Yahoo has priced the service substantially less than competitors'' products. RealNetworks Inc., for example, charges $9.95 a month for playing songs on a PC, and $14.95 a month to add the portability option of playing tunes on a digital player.
Yahoo also lowered the price of buy-to-own music for customers of its subscription service to 79 cents a track from 99 cents a track, which is the going rate among competitors.
With a 100 million U.S. users of its site a month, Yahoo''s entry is sure to add a major boost to the online subscription market, which is expected to surpass buy-to-own music by 2009, when revenues are expected to be $900 million and $800 million, respectively, according to JupiterResearch.
In four years, music downloaded from the Internet, either through individual purchases or subscription, are expected to account for 12 percent of the $13.5 billion consumers are projected to spend on music, JupiterResearch says. In 2003, music downloads accounted for one percent of the $12 billion spent on music.
Apple Computer Inc.''s iTunes music store remains the market leader in buy-to-own music. While the company hasn''t launched a subscription service, many experts believe it will have to eventually.
To help build a community around its subscription service, Yahoo has integrated its instant messaging service Yahoo Messenger, so subscribers can share play lists and discuss their favorite tunes.
Yahoo made its big push in online music last year when it paid $160 million for MusicMatch Inc., which sells song and album downloads, and also offers a non-portable subscription service. On Wednesday, Yahoo plans to lower MusicMatch''s pricing to match that of the new service. In addition, Yahoo said it plans to combine the two services, but hasn''t released a timetable.
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