Sony, Universal Join Forces for Subscription Music Service

It's mating season for entertainment-industry giants. Sony Music Entertainment and Universal Music Group are in talks to develop a jointly operated subscription music service for the Internet, according to a report the two companies issued in the first week of May. The news followed by only a week an announcement of a possible merger between record clubs Columbia House and BMG Music Club.

Sony Music Entertainment is a unit of Sony Corp. of Japan; Universal Music Group is a unit of Seagram, Ltd. of Montreal. The two music companies are members of the "Big Five" conglomerates who control most of the world's recorded music. Together, Sony and Universal account for about 45% of the US music market, according to industry tracking organization SoundScan Inc.

The new service under discussion will enable subscribers to order whatever music they want for a flat monthly fee, more like the business model of cable television and less like the traditional retail model of selling entire albums. Custom CD compilers, who charge their customers on a per-song basis, pioneered the concept of selling individual songs rather than entire albums.

The planned subscription service will include music and music-related video offerings, to be distributed over the Internet "across multiple platforms such as computers, wireless personal devices, and set-top boxes," according to the announcement. Both companies will contribute content for the venture, executives said. A Sony-Universal partnership further complicates the already incestuous relationships among various music companies. Sony Music is a partner with Time Warner's Warner Music Group in Columbia House; Universal has a partnership with BMG Entertainment in getmusic.com, an Internet music service. As a favorite guru was fond of saying: It is all one.

Share | |
Site Map / Direct Links