Posted on: Tuesday, August 19, 2003
Best Buy teams with Internet music service
By Helen Jung
Associated Press
SEATTLE — RealNetworks Inc. and electronics retailer Best Buy announced a deal yesterday in which customers can try out and sign up for RealNetworks' online music service at Best Buy's 560 stores across the country.
The agreement, which unites traditional sales with the fledgling Internet business of digital music, boosts competition among companies racing to distinguish themselves in the market for legally downloading music.
RealNetworks has been aggressively making deals with high-speed Internet service companies to drive customers to its Rhapsody digital music subscription service, which it acquired in its recent purchase of San Francisco-based Listen.com. More are to come, said Dan Sheeran, RealNetworks' senior vice president of marketing.
With Rhapsody — including the new Best Buy Rhapsody service — customers pay a $9.95 monthly fee to listen to songs from a vast library of music from the major record labels as well as independent producers. Rhapsody subscribers can also burn songs onto compact discs for 79 cents each.
The service is one of several to emerge recently. Apple Computer launched its iTunes Music Store in April, offering digital downloads of music for 99 cents a song. Microsoft last week teamed with a British company to offer a European service selling songs over the Internet for 99 euro cents (about $1.12) each through Microsoft's MSN Music Club or Tiscali Music Club.
The deal with Minneapolis-based Best Buy — in which the two companies will share revenue from subscribers — will help RealNetworks spread from its base of technology-savvy customers to a mainstream audience, Sheeran said.
He added that RealNetworks plans to offer a service by the end of the year that lets customers burn songs onto CDs without having to be a monthly subscriber.
Although he would not disclose other possible partners for the service, he said it is "the type of thing that e-retailers are interested in."
Companies have been increasingly casting about for legal ways to sell songs over the Internet that do not handcuff consumers' use of the music, but that also respect record labels' copyright concerns. Besides Apple and Microsoft, Amazon.com has also said it is looking into selling digital music over the Internet.
