The price, assuming a deal is completed, likely will be about $200 million, one person told the newspaper. Yahoo! and Myplay officials declined to comment, the Wall Street Journal said.

Myplay is a closely held company in Redwood City, Calif., that has attracted attention for a digital system that appears to be acceptable to record companies concerned about the issue of piracy on the Internet, the article said.

Myplay offers consumers what it calls a "virtual" locker, allowing them to store computerized copies of their compact disks on the company's Web site, according to the Wall Street Journal.

Yahoo!, a Santa Clara, Calif., Web portal, has been looking at ways to expand its involvement in online music, the article said.

In recent months it has had talks with Sony Corp.'s Sony Music Entertainment and Seagram Co.'s Universal Music Group about music initiatives, according to people familiar with the situation, although those two companies decided to launch their own subscription service together.

Myplay has a deal with Internet-service provider America Online Inc., of Dulles, Va., to provide users of AOL's Winamp and Spinner units with virtual music lockers, the article said. The people close to the matter said the relationship with AOL, a direct rival of Yahoo!, could complicate the latest talks, according to the Wall Street Journal.