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MTV to challenge Apple's iTunes

22/08/2007

A company linked to the MTV music channel has become the latest online music provider to launch a challenge to Apple's dominance of the digital download market.

Viacom's MTV Networks announced yesterday that it is planning to merge its Urge music store with RealNetworks' download service, Rhapsody, with analysts interpreting the move as a deliberate attempt to take on Apple's crown.

The announcement of the deal comes amid the launch of another music download service, gBox, which is also going head-to-head with Apple's online music store iTunes by selling digital tracks without the customary copy protection technology attached.

As part of the venture between MTV Networks and Realworks, consumers will be able to access the latest digital download service, Rhapsody America, on computers, music players and mobile phones.

Currently software giant Apple is the key player in the digital download market, but copy protection technology means that music lovers who buy tracks from its iTunes store can generally only listen to them on the company's iPod players and iPhones.

US-based consultancy Forrester Research said the planned offering from MTV Networks represented a direct attempt to take on iTunes, but warned that the battle would not be easy.

"It is an attempt to create a powerhouse that's going to be able to compete with iTunes," analyst Josh Bernoff told the Associated Press.

Analysts have also stressed that Universal Music's entry into the music download market is likely to put commercial pressure on iTunes.

In a move which will allow music fans to copy tracks purchased in a digital format for free, the world's largest music label revealed earlier this month that it had teamed up with search engine Google to support the new gBox store. Under an advertising deal consumers searching for music information online will automatically be directed to the website, which was launched yesterday and will initially only be available to US music lovers.

The new online store will sell songs by Universal artists which do not feature the usual digital rights management (DRM) protection that is used by the recording industry to prevent tracks in a digital format from being copied.

It is part of a trial that is being carried out by the record label to assess the impact that removing the copy-protection technology will have on online piracy and consumer demand for songs that can be freely copied and played on portable music players and computers.

Universal, whose artists include Amy Winehouse and Bon Jovi, has confirmed that other online retailers including Wal-Mart and Amazon.com are also participating in its trial.

"We're committed to exploring new ways to expand the availability of our artists' music online, while offering consumers the most choice in how and where they purchase and enjoy our music," said Universal Music chief executive Doug Morris.




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