VZW rhapsodizes on music

Verizon Wireless is no longer tackling the mobile music market solely under its own brand, announcing today the long-awaited paring of its mobile music service with RealNetworks. Verizon will move its music service to a more open platform and launch a subscription music service all fueled by Real’s online music portal, Rhapsody.

Though customers will still be able to purchase music over the air from the V Cast Music service, the service will now be directly linked to the Rhapsody online portal, which strips all digital rights management protection from the songs and supports numerous portable music players, not just Verizon Wireless phones. Furthermore, the service is going subscription-based: Customers that don’t want to permanently buy a song track can subscribe to the entire Rhapsody catalog for $15 a month, in which they can transfer any number of protected tracks to their phones or music players for the duration of their subscriptions.

Verizon Wireless officials said the reformatting of the music store was to give V Cast music a broader scope. Its original service, powered by Microsoft, downloaded separate tracks to the phone and PC, all protected under Windows Media DRM. While the service was a success, said John Harrobin, VZW senior vice president of digital media and marketing, the service went in the opposite direction Verizon expected. Instead of buying music online and transferring it to the phone, 90% of downloads were being initiated from the more-expensive over-the-air music portal. While that was good for incremental data revenues, it wasn’t doing much to establish Verizon as a competitive online provider of digital music. Harrobin said it wanted to link the service more closely to the PC and the vast online marketplace of the Internet. “We knew we had to improve the PC experience because that was where people managed their music,” Harrobin said.

The shift from Microsoft to RealNetworks was much smoother than it might have appeared to an outsider. First off, Real bought The Platform, the music distribution and management service that powered V Cast Music. Second, Microsoft started to shift its strategy away from partnerships toward its own music service and devices with the launch of Zune. Meanwhile Real was headed in the opposite direction, said Rob Glaser, CEO of RealNetworks. “From a technology perspective, we’ve gone more horizontal,” he said. “Microsoft has gone vertical.”

The Rhapsody platform will still support Microsoft’s DRM on over-the-air music downloads, but purchased songs through the Rhapsody portal will be in open MP3 formats. The Rhapsody service is powered by The Platform’s back end as is V Cast music, making integration a snap. Still the service took almost a year to launch, since Real and Verizon announced the partnership last August. The service will initially be supported on seven of VZW’s current V Cast phones as well as new music phones launched going forward. The first of those will be the upcoming LG Chocolate 3.