MTV, Microsoft Get Urge to Sell Music Online

Urge, a new online music service developed in conjunction with Microsoft (Nasdaq: MSFT) and MTV Networks, is getting set to make its long-awaited debut this week. On Wednesday, the beta version of Windows Media Player 11 will be released -- with Urge as its default online music setting.

It is a departure from previous releases in which Microsoft would provide equal access to the growing numbers of compatible music services. While Windows Media Player 11 still offers this access, it has given the top spot to Urge by integrating it directly into the product.

On one hand, the offering is rather standard fare, joining the handful of other online music providers that have been trying to gain traction in this space.

Songs -- there are about 2 million in the library -- will sell for 99 US cents, or $9.95 per album -- or $14.95 per month for subscription. Users will have to maintain their subscriptions in order to have access to their purchased material -- a common feature among most of the music service providers.

The difference between Urge and other services is that it has strong enough backing to go up against Apple's (Nasdaq: AAPL) iTunes.

Apple in Its Sights

Apple's iTunes, of course, is the music provider Microsoft and MTV want to beat. Since the store was introduced in 2001, it has sold more than 1 billion songs through its a la carte business model. iTunes -- an endeavor in which Apple barely breaks even -- has propelled Apple's iPod product line to icon status.

It is this synchronicity between product and service that accounts for the limited success of other online music providers, according to Yankee Group analyst Nitin Gupta.

"What has hurt adoption is that online providers like Rhapsody and Napster do not have tight integration with a device like the iPod and they do not have the marketing muscle to promote the services -- largely because they don't have a revenue generator like the iPod is for Apple," he told MacNewsWorld.

Competitive Play

Unlike other online music endeavors, Urge will put real competitive pressure on iTunes, Gupta predicted.

"I think the market will be very competitive going forward. MTV does have marketing muscle, and it doesn't need Urge to be a core revenue-generating service," he explained. Also, it has many business and marketing options at its disposal, including the ability to integrate Urge with some of its television properties.

"MTV is a media company, and it will be able to develop synergies between the music service and other media properties," observed Gupta.