Jonathan Axelrod and Robert Khedouri, Co-founders, MusicGremlin

From the transistor radio to the Walkman to the iPod, portability has long played a pivotal role in the consumption of recorded music. Now Jonathan Axelrod and Robert Khedouri plan to do Sony and Apple one better: Their MusicGremlin service enables downloading directly to wireless devices via Wi-Fi.

“We believed there were problems with existing digital music services because there were no architectures for the mobile environment, and they all required use of a PC,” Axelrod said.

Longtime music fans Axelrod and Khedouri met while working with management consulting firm McKinsey & Company, co-founding New York City-based MusicGremlin in early 2003. The company's software works on any wireless device that meets minimum requirements for storage and connectivity. Users can either subscribe to an all-you-can-eat monthly plan, with music disappearing if they cancel their subscription, or an ala carte service similar to Apple's iTunes, where for a buck or two, songs are theirs forever.

MusicGremlin is in the process of licensing a database of more than 500,000 songs that will reside on the device itself, so subscribers can select music for downloading even when they're not connected to a wireless network; when they are connected, that database is automatically updated with new music.

Digital rights management features and additional security checks prevent illegal pirating and sharing, although subscribers will be able to share music with one another — for example, downloading tracks from another subscriber's playlist.

Despite the recording industry's ongoing tussle with illegal online music sites, labels seem receptive to MusicGremlin's potential. “The music industry recognizes a huge opportunity here — the ringtones market in particular has really woken them up to that,” Khedouri said.

MusicGremlin made its public debut last spring at CTIA Wireless 2004, sharing space at the Flarion booth. Naturally, the service operates over Flarion's Flash-OFDM technology as well as traditional wireless LANs. The company is currently in tests with a number of consumer electronics companies, with a commercial launch planned for late 2004 or early 2005.

“A lot of electronics companies looking to take a bite out of Apple will look to distinguish themselves with some new feature sets, and that's exactly what we provide them,” Khedouri said. “And carriers who are building 3G networks have to find something compelling to put on them.”