BSkyB, Universal team for tunes

Pay TV operator launching U.K. music service

British pay TV operator BSkyB is launching a U.K. music service offering subscriptions and downloads, beginning with Universal Music’s catalog.

As the first partner in the service, U will also become a shareholder. Sky is in discussions with other record labels about joining the venture.

Set to launch by the end of the year, the as-yet-unnamed service will offer access to hundreds of thousands of songs from Universal’s roster of artists, including U2, Kanye West, Amy Winehouse, Abba and Elton John.

Sky’s service will charge a monthly fee; subscribers will receive unlimited access to streamed songs as well as the opportunity to download songs to own. A range of subscription options will be available, although pricing of the packages, as well as the number of tracks that will be made available to download, have yet to be revealed. Downloaded tracks will work on any device that can play MP3s.

“It’s clear that there’s huge demand for online music, and companies like Sky and Universal Music are well placed to work together to meet consumers’ need,” said BSkyB chief operating officer Mike Darcey.

Lucian Grainge, chairman-CEO of Universal Music Group Intl. said: “In a world where a majority of U.K. homes have high-speed broadband access, consumers will welcome a safe, state-of-the-art service and legal alternative to those services which exploit musicians without compensation.”

The new service will face stiff competition from iTunes, which currently accounts for more than 70% of the U.K. digital music market, as well as a number of other download services including HMV and the soon-to-launch Amazon U.K.

Sky is hoping its expertise in delivering and marketing pay TV services, as well as a customer base of some 8.9 million pay TV homes, will give it a substantial leg up in the market.

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