“MTV Networks is expected to launch an online music service powered by MusicNet later this year, making it the latest big brand to enter an increasingly crowded market for online music, according to people familiar with the plan,” Reuters reports. “Both MTV, a unit of Viacom, and MusicNet, a joint venture of RealNetworks and three labels, Bertelsmann’s BMG, EMI Group and Warner Music, declined to comment.”
“MTV has indicated before that it wants to enter the digital-music arena, a market that is gaining momentum with the advent of popular services like Apple Computer’s popular iTunes service,” Reuters reports. MusicNet is a business-to-business company that charges its clients fees for offering them the technology, the infrastructure and its catalog of licensed music to develop digital music services.”
Some of MusicNet’s customers use Microsoft’s Windows Media Audio (WMA) proprietary format to compress the music. Other MusicNet customers use RealNetworks’ proprietary audio format. Apple Computer’s iTunes Music Store dominates the current legit online music landscape with over 70% market share. If MTV chooses to use WMA or Real formats, songs purchase form MTV’s store would not play on Apple’s other market-leading phenomenons, the iPod and iPod mini, as they are now configured.
“It was unclear which format the MTV deal would involve, the people familiar with the discussions said. It was also unclear what the MTV service will cost, although similar services now charge about $1 a song or about $10 a month for unlimited use of streamed music,” Reuters reports. “MTV hopes to use its brand awareness and clout with young music fans in a strategy similar to that of electronics giant Sony, which this week announced a new online music service called Sony Connect, which is compatible with its MiniDisc Walkman devices.”
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