VZW to revamp VCast music with MTV, Real

Verizon Wireless, Viacom’s MTV and RealNetworks are partnering to create a digital music service that will span three major media: television, the Internet and the mobile network. Though the details of the deal are unclear, the companies said today the end goal is to integrate the wired Internet and over-the-air downloads into a unified music offering that spans all devices, from PCs to digital music players to mobile phones—all tied together with MTV’s all-pervasive media presence.

A partnership between Verizon Wireless and Real doesn’t come as a surprise since Real bought VZW’s music platform provider WiderThan for $350 million last September. But while the Platform provided white label music services for mobile and fixed operators worldwide, Real runs its own retail music service Rhapsody, which competes with other digital download and streaming services, mobile or otherwise. As part of the tripartite deal, Real and MTV will form a venture called Rhapsody America, which will be the pair’s sole music service and portal in the U.S.

Rhapsody America, in turn, has signed an exclusive “long-term” deal with Verizon Wireless to fill in the mobile music side of the equation. Verizon Wireless said Rhapsody will integrate completely with VCast Music, though it did not say whether Rhapsody would supplant VCast Music entirely. As for the details of the service, all of the companies were vague, saying only that digital music sales would be tied together, obviating the need for multiple music services for multiple platforms. Rhapsody, for instance, is primarily a music subscription service, which allows customers to stream radio channels, specific songs and download rights-protected music for a monthly subscription fee. VCast music, however, sells individual songs for download to the phone and the PC.

Verizon Wireless executive vice president and chief marketing officer John Stratton said that while the companies are not revealing specifics on the new service, it definitely would include a digital download element. “We have a service today that allows for over-the-air-downloads, and we absolutely expect that to be an integrated part of the new service,” he said.

Also up in the air are the complex relations the companies have with Microsoft. MTV has its own music store called Urge, which it launched in partnership with Microsoft, Real’s biggest competitor in the media player space. To add complication, VCast music uses Windows Media Player software and Windows Media Audio formats, while Rhapsody uses Real’s RealPlayer technology and digital formats.

The power of the three companies partnering, however, is indisputable. MTV’s TV and other media presence—spread across not just the MTV branded stations, but Nickelodeon, VH1 and Comedy Central—combined with VZW’s size and distribution in the U.S. and RealNetworks' technology will create a digital music juggernaut, said Van Toffler, president of MTV Networks’ Music, Logo and Films Group.

“We’re partnering with the No.1 subscription service and the No. 1 mobile music company,” Toffler said. “With these two folks at our side, we’re confident this will be a stellar service.”