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    Online music firm Wippit in download deal with BMG

    Bertelsmann's BMG music label, home to such artists as Outkast and Dido, will start selling song downloads through European digital music store Wippit later this week, the companies said.


    With the BMG deal, London-based Wippit has signed two of the world's five largest music labels. Earlier this month, EMI announced it will begin selling downloads this month for such artists as Coldplay and the Rolling Stones to Wippit's European customer base.Europe's piracy-battered music industry has been actively expanding its ties with subscription download services to head off the popularity of free file-sharing networks such as Kazaa and WinMX and halt the global decline in recorded music sales.


    "2004 looks like it will mark the year where the legitimate market for digital music comes of age," said Jon Davis, Director of New Media of BMG UK and Ireland.


    The willingness to work with multiple European song outlets contrasts with the industry's stance a year ago.


    Until recently, downloads from each of the five major music labels -- which account for three-quarters of all songs sold -- could only be found on European online retailers who partnered with a single digital media firm, Britain's OD2.


    The European online music scene this year is expected to explode, with over 50 new digital music ventures set to launch including Apple Computer Inc's (nasdaq: AAPL - news - people) iTunes and Roxio's (nasdaq: ROXI - news - people) Napster.


    The four-year-old Wippit now has a catalogue of over 175,000 tracks from over 200 labels, founder and chief executive officer Paul Myers told Reuters.


    The BMG and EMI signings also underscore record labels' newfound willingness to work with a variety of business models to boost the still nascent market for digital downloads which they see as crucial to turning around the slumping industry.


    Wippit is somewhat unique in that it offers an annual 30 pound ($53.80) subscription charge for unlimited downloads. The labels had been more willing to work with digital music stores that charge a per-track fee, a model popularised by iTunes.


    For EMI music downloads, Wippit charges a per-track fee of under 50 pence per song that does not require the annual subscription.


    Like iTunes, Wippit allows users to burn songs onto a compact disc or transport them onto a digital music device.


    BMG artists will be available to Wippit's British and Irish customers only at launch.


    "We have a backlog of labels we are in negotiations with. There's only one major label we are not in contract with," said Myers, who declined to say which label that is.


    The popularity of portable music devices such as Apple's iPod is driving the market, he added. "What's really going to take this market forward is when people buy a car with a digital player installed," he said.


    Source: Forbes.com

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