Rhapsody starts playing music

The first in a wave of digital music subscription services that gives consumers unrestricted freedom to listen to and interact with online music, has beaten the major labels' service to market.

San Francisco's Listen.com said its new service, Rhapsody, offers music fans features such as unlimited streams of music, access to more than 50 commercial-free internet radio stations, and a playlist-sharing program that lets people create mixes and send them to friends.

Instead of confining consumers to a set number of songs per month or offering songs that time out after set periods of time, Rhapsody will offer consumers open access to the music in several subscription options.

The options include classical music; an eclectic sampling of music from a range of genres, including blues, rock, and country; and a sampler plus catalogue, an all-access alternative that combines two catalogues into a single subscription offering.

Initially Rhapsody's library of digital music will include those from the company's licensing agreements with independent labels such as Monarch Records, LoveCat Records and Heydey Records.

Listen.com's news comes shortly after it announced an agreement to use music protected by The Harry Fox Agency (HFA), the licensing subsidiary of the National Music Publishers Association. Listen.com will pay HFA an advance of up to $500,000 towards the royalties to be determined by the US Copyright Office.

Meanwhile, the major labels are gearing up to launch their own music subscription services this month. Sony and Vivendi Universal are expected to release Pressplay, while RealNetworks, AOL Time Warner, Bertelsmann and EMI will launch MusicNet.

Rhapsody breaks away from the models developed by such labels. Both MusicNet and Pressplay are expected to limit the number of downloads, while Listen.com gives its customers unlimited access to music for a flat monthly fee.

Market researchers at IDC expect the online music market to grow slowly at first, with expectations of it generating only about $1.6bn in revenues by 2005.