Yahoo! launches music downloads service

By Steve Malone

Posted on 11 May 2005 at 12:49

The rapidly expanding Internet portal Yahoo! is set to take on iTunes and Napster with its own music subscription service. The company has announced a beta version of the Yahoo! Music Unlimited service from today.

As part of the launch, US subscribers are offered a week's free subscription to the service that claims to have more than one million tracks encoded at 192Kbs available to download and play. Customers can choose either to buy an annual subscription at $59.88 or a monthly subscription at $6.99. However, if you do not keep up the payments, the music you have downloaded becomes unplayable.

However, the service will allow customers to buy tracks and burn them to CD outright. Yahoo's price per track is 79c compared with Napster's 99c. Alternatively, music can be transferred to a 'Play for Sure' compatible portable device based around the Microsoft Windows DRM 10 software. However, these music players are mostly from Creative and iRiver and form a minority of the market even in the US.

Which is another way of saying that the Yahoo service is for Windows XP machines only. The service also requires IE 6.0 and Windows Media Player 9.0.

The Yahoo! Music Unlimited service uses its own free music management software, the Yahoo! Music Engine. This allows users to rip, mix and burn CDs, import and manage music, and transfer music to their portable music players. Yahoo! says that downloads purchased through the service can be burned onto CDs, transferred to compatible portable devices, and used on a total of five PCs.

iPods are not currently compatible with the Yahoo! Music Unlimited subscription service. Yahoo! says that iPod users can use the Yahoo! Music Engine, via a Windows-based PC, to transfer music they already own to Apple devices.

To no real surprise, the service also allows Yahoo! Messenger subscribers to listen to each other's play lists and presumably will soon become part of Yahoo!'s burgeoning Yahoo! 360 online community initiative.

This is not Yahoo!'s first foray into online music. Last year it paid $160 million for the MusicMatch service. The company says that it will be bringing MusicMatch's prices and service into line with Music Unlimited in the near future.

Although Yahoo! is late to the game in its own capacity, there is still a huge potential in the PC market. Real Networks claims more than 1 million subscribers while the former bad boy of downloading turned legit, Napster, now says it has 410,000 subscribers

At the time of writing Yahoo! could not say when the service would be launched in Europe. However, experience suggests a European service may be several months away as royalty negotiations have to be conducted separately. Furthermore, the Play for Sure devices have only limited sales in the UK where the iPod dominates.