Sky and Universal to challenge iTunes


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Aug 29, 2001
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Sky will attempt to take the initiative in the UK digital music market later this year by launching a subscription-based streaming and download service.

"Providing a simple new way for fans to consume music, both streamed tracks and downloads to keep are available through just one monthly subscription, a world first," said Sky. "A range of subscription options will be available, offering different download packages tailored to customers’ needs."

Different tiers will offer varying numbers of tracks per month, with the top option likely to give unlimited "eat as much as you like" access.

Sky has already agreed a deal for full access to the catalogue of Universal Music, which includes many big name acts, and is negotiating with other major and independent record labels.

Universal has long been unhappy with Apple's iTunes service - which dominates digital music in the UK and US - and has previously advocated a subscription-based alternative.

The new venture will be operated as a separate company with Sky, as the majority shareholder, providing "expertise in the delivery of subscription services... content aggregation, packaging and marketing". Universal has taken a stake in the new firm and future partners will also be offered shares.

It is unclear what format downloaded tracks will take - record companies generally require some form of copy protection - but Sky said they would be "to own forever" and "work on any mp3-compatible fixed or portable device".

The name of the service and pricing will be announced at a later date, ahead of a launch some time this year.

"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’ needs," said Sky chief operating officer Mike Darcey. "We aim to offer an easy and affordable service for all UK music fans, while ensuring that artists are properly rewarded for their creativity."

Lucian Grainge, chairman and chief executive of Universal, added: "The new Sky service will provide a compelling digital music experience, built for the ever growing digital appetite of music fans. In a world where a majority of UK 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

By Dave West, Media Correspondent DS