Music streamer packs tunes by all five cos.

Listen.com has taken the checkered flag in the closely watched race to offer digital music from all five major label groups, inking a licensing deal to use the digital catalog of Universal Music for its subscription streaming service Rhapsody.

After the close of the deal, set to be announced today, Rhapsody users will have access to a total of 175,000 digitized tracks. That includes about 20,000 from U’s digital library, among them songs by artists like Eminem, Jay-Z and Ashanti. Listen expects to have a total of 200,000 tracks available by the end of this month.

San Francisco-based Netco had already secured deals with Warner Music, EMI, Sony Music and BMG, as well as independents Zomba Music and TVT Records.

Wealth of tracks

“It doesn’t just bring us Universal’s 30% market share, but by making the service complete, it increases the utility by a thousand percent,” said Listen chief exec Sean Ryan in an interview. “People are just blown away by how much is available, as opposed to looking for what’s not — that’s the real tipping point.”

With the latest license, Listen also beat the two main label-backed efforts, MusicNet and Pressplay, to the punch. MusicNet offers work from EMI, BMG and Warner, while Pressplay has deals with Sony, Universal and EMI.

Licensing for those two subscription services is more complicated because they offer downloads instead of just streams. They’re also constrained by antitrust issues because of their industry backing.

Another big issue for all the paid-subscription services is portability. Pressplay has offered limited CD burning on its site, but for the most part, transferring to portable devices hasn’t been a big part of the subscription business model to date.

Portability plan

Listen’s Ryan expects to change that by the end of this year: Exec said the company is in talks to offer burning as part of the Rhapsody service, and he has plans to stream music directly to portable devices like next-generation Internet-enabled cell phones.

“In order to take it into the mainstream, obviously portability has got to increase,” he said.

Pay services also have to contend with their free counterparts — wildly popular peer sites like Kazaa, Morpheus and Limewire. The record industry has set its lawyers upon these networks for flouting copyright laws, but for now they continue to draw millions of users daily.

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