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How Will Virgin Meet Sky’s Music Plan? Perhaps By Snapping Up Playlouder?

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Sky and Virgin Media (NSDQ: VMED) have duked it out over broadband access, now it’s down to the value-add. With yesterday’s announcement it is planning a monthly music subscription service, Sky has stolen a march over its big rival, whose own music ambitions are languishing. Virgin’s low-key unlimited downloads offering, powered by OD2 white label for Windows only, is not bundled with its internet access but is a £5-a-month optional extra; this month, the ISP suggested it wanted to do more: “We have been in exploratory discussions with a number of rights holders for some time about the potential for innovative future business models for delivering music to our broadband customers. These discussions, however, remain at an early stage.”

So what’s Virgin to do? paidContent:UK understands the company has been in some kind of talks with Playlouder MSP. Formed out of the ashes of the original music news site, Playlouder has, since 2003, been operating as a broadband ISP which offers unlimited music bundled in to the subscription price. It’s an innovative model and, with licenses from EMI, SonyBMG and indies, Playlouder was the first to do it. But now the unlimited subscription space is starting to get crowded; Nokia (NYSE: NOK), Omnifone, Orange, Danish ISP TDC and more are jumping aboard. Without having built a significant business of its own, the time may be right for Playlouder to license or sell its technology platform.