BSkyB, Universal Form JV To Launch Subscription Music Service
This story was written by Robert Andrews.
Pretty soon, everybody will be offering a subscription music service. Latest is UK satcaster and ISP BSkyB (NYSE: BSY), 39 percent owned by News Corp (NYSE: NWS). it's secured Universal's Total Music repertoire (which includes Amy Winehouse) for a new launch that will allow unlimited MP3 downloading and on-demand streaming for a monthly subscription in the UK and Ireland. And it's starting a new joint venture company for the purpose, in which it will be the majority partner. Universal is becoming a shareholder.
This is clearly a very early announcement - Sky says there will be "a range" of subscription packages, but there are not yet any prices and Sky is, of course, lacking buy-in from any other labels. Indies shouldn't be a big problem; Sky has presumably announced early to get word out and bring aboard the others. The company says it's "in discussions with other music companies, both majors and independents, and expects to announce further partners soon".
But Sky isn't tying it solely to either its broadband or TV offerings. Sure, it will "use its expertise in the delivery of subscription services as well as in content aggregation, packaging and marketing to support the service". But the release says there is only the potential "to attract traffic to the service from Sky's current online portal and broadband access businesses". That leaves the door open for the service to be offered under a distinct brand, to companies that might be considered competition to Sky.
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By Robert Andrews