MusicMatch, Sony Electronics in CD-Burning Deal
By Sue Zeidler
LOS ANGELES (Reuters) - Online music company MusicMatch Inc. on Thursday said it reached a deal for Sony Corp (news - web sites).'s (6758.T) Sony Electronics to integrate MusicMatch's Jukebox software into Sony devices enabling people to burn music onto blank compact discs.
The deal is expected to boost software revenues for privately-held MusicMatch, which expects to be profitable by year's end and to double its 2000 revenues of $10 million to $20 million in 2001, said MusicMatch spokesman Gary Brotman.
Beginning this month, MusicMatch Jukebox will ship with seven lines of internal and external Sony-branded CD-recordable and CD-rewritable drives worldwide. MusicMatch Jukebox will also ship with 12 additional lines of Sony-branded CD-R/RW drives by the end of 2001.
MusicMatch software has an integrated CD burning feature that lets consumers create their own music CDs, competing directly with RealNetworks Inc.'s (NasdaqNM:RNWK - news), which uses software by Roxio Inc. (NasdaqNM:ROXI - news) to enable its users to burn CDs off their computers.
``With the addition of Sony to our list of distribution partners, MusicMatch will now ship with over 60 percent of CD-recordable drives worldwide by year's end,'' said Brotman, noting there are many cases where both MusicMatch software and Roxio software are offered on the same device.
The MusicMatch/Sony deal follows an agreement earlier this week between EMI Group Plc (news - web sites) (EMI.L) and Roxio, marking the first time a giant music company was moving to develop a secure way for burning music onto blank CDs.
MusicMatch's deal is with Sony Electronics and has nothing to do with Sony's Sony Music arm, home to stars like Bruce Springsteen and Celine Dion (news - web sites), but some analysts expect the two divisions will someday work to integrate their products.
``This is a step in keeping Sony wired to the digital age. This is enabling all of the Sony products to easily let users burn CDs and work with digital files,'' said PJ McNealy, senior analyst with Gartner.
``Its likely that at some point in the next 12 to 18 months, Sony Music will have some integrated offerings with Sony Electronics,'' said McNealy.
It is estimated that up to 5 billion blank CDs will have been shipped in the year in support of an estimated installed base of 100 million CD recorders in personal computers.
Last month, MusicMatch launched a subscription radio service that will eventually let it sell digital songs over the Internet. The new service, called Radio MX, builds on MusicMatch's existing radio feature that lets users create custom stations featuring music similar to their favorite artists. In its test form, the service will cost subscribers $5 a month, or $50 a year.
The plan is to make songs available for download through the service by late summer and the company is currently trying to strike deals with record labels to actually start selling the songs.
Citing a new eagerness by record labels to embrace Internet music, MusicMatch has recently said it is optimistic it will launch the service with 20,000 to 30,000 songs by late summer and double that selection by the end of the year.
San Diego-based MusicMatch says its software has more than 20 million registered users.
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