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Yahoo! Turns on LAUNCH Music Site

Call it the month of online music if you want to, because companies all over the country have been busy rolling out their music subscription services. If it's at all possible to saturate the market in a month's time, it will happen in this increasingly crowded sector as Yahoo! Inc. Monday launched its new music destination, LAUNCH.

But unlike the likes of Rhapsody, MusicNet or pressplay, the latter two of which are backed with the mighty weight of the Big 5 recording companies, the Santa Monica-based concern isn't posing LAUNCH as a subscription service -- just a destination offering music downloads and access to videos and radio.

LAUNCH, which was hatched out of Yahoo!'s June acquisition of LAUNCH Media Inc., is merely a site designed to bolster Yahoo! Music. Like its subscription service brethren, it will also feature artist interviews, artist features, music news, photos, chart information and album reviews. Run by LAUNCH Media co-founders Dave Goldberg and Bob Roback, it can be accessed via the "Music" button on Yahoo!'s home page.

Yahoo!, acting in what has been its consistent modus operandi, has positioned the announcement as a key way to help entities promote themselves. In this case, the firm said labels and artists will benefit from the exposure. LAUNCH has a sales force committed to creating solutions for its advertising and marketing partners, and will also market music-related services, such as pressplay. Interestingly, Yahoo! pulled an unusual move by allowing LAUNCH to operate under its own brand, instead of simply digesting it and retaining the Yahoo! Music name. One can conclude the play hints at Yahoo!'s confidence in the LAUNCH brand.

"As part of our Media & Information business, our new LAUNCH destination strengthens our leadership in the online entertainment space," said Greg Coleman, executive vice president for Yahoo!'s North American Operations. "The integration will allow us to build deeper relationships with our consumers and provide enhanced solutions for our marketing and advertising clients."

In the broader picture, the move is Yahoo!'s second significant embrace of online music, as the firm also pledged its support for Vivendi Universal Music's and Sony Music's pressplay service, which has for itself an interesting situation. While it's been beaten to the punch this month by Listen.com's Rhapsody and MusicNet, it recently announced it would let consumers copy, (or "burn" or "rip" music, as it's known in the industry) music onto CDs. This, analysts said, is a must in an industry where a key driver will be offering value-added services that differentiate between rivals to hook consumers.

Indeed, research firms such as Jupiter Media Metrix have been skeptical, saying that although label-sponsored digital music subscription services will raise the bar in terms of offering the high quality service that consumers want, they will not provide features necessary to retain long-term customers.

"Label-backed initiatives like MusicNet and PressPlay are doing the right thing by focusing on quality of service as a key differentiator from the free services out there," said Danielle Romano, analyst, Jupiter Media Metrix. "However, these ventures must continue to experiment with new features that consumers want in order to capitalize on the potential market left over from Napster."