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Musicbank has become the latest company to license EMI's digital music archive in return for cash and warrants to buy an equity stake in the online business.

San Francisco-based Musicbank will join the likes of Liquid Audio, Supertracks, the Tornado Group, On Demand Distribution and Digital Distribution Domain (Dx3), all of whom EMI has granted the right to resell digital copies of its back-catalogue, all on similar terms.

Some EMI partners sell directly to listeners, other to e-tailers who will themselves target consumers. EMI, one of the world's big five music labels, is replicating its old economy distribution model in the online arena.

Musicbank's service is essentially an alternative to MP3.com's My.MP3.com, which provides users with a way to listen to their CD collection no matter where they happen to be. Musicbank has clearly learned from its rival's legal travails - it sought permission from all the major labels before launching its service. EMI is the latest to license its content - the online operational already has deals with Sony, BMG, Universal and Warner.

Like My.MP3.com, Musicbank's service will operate two strands: a free version that limits the number of discs a user can hold in their online collection, and an unlimited, subscription-based alternative. The subscription fee is set to come in under $5, the company said - so expect it to be $4.95.

Musicbank will pay EMI a fee every time a disc is registered and again when the CD is accessed, so it's going to have to keep a tight limit on the free service - or hope for plenty of advertising revenue. It probably has similar arrangements with the other labels.

Registrations may come thick and fast. The company has struck a deal with Virgin Megastores to auto-register customers' CD purchases. It said it hopes similar deals with other music stores will follow. ®

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