Digital Home Thoughts: Yahoo Releases Music Download Service

Yahoo has released their new music service with a bang. Either $0.99 a song or an amazing $4.99/mo for unlimited songs. 8O The catalog is smaller than most, but I suspect that they'll be able to increase that quickly. Plus with the subscription, you get ad-free LAUNCHcast radio. The only thing really missing here is Musicmatch (or my guess this is Musicmatch, can anyone tell?). Kind of makes you wonder what they plan to do with that.

I personally don't care for music subscriptions, but this price point might just jump start the "format". I doubt they'll make any money at this point on it, but Napster has to be really worried. Unlike Yahoo!, Napster and to a lesser extent Real don't have the ad sales to really compete in this marketplace. You have to wonder how much longer Napster can really go with this kind of pressure. I don't think this really hurts iTunes too much at this point. The jury is still out on subscriptions and I can only assume that Apple would offer them if the market demanded. Another issue I've begun to see is that these new services don't really compete against iTunes, but rather each other. If Microsoft is going to push Apple back, they'll need their partners to work together and not try and put each other out of business.

Still, lower prices are good for consumers and I'm guessing others will follow with the $5/month price soon.