Virgin, HMV to launch UK music downloads

Arch retail rivals face off

By Tony Smith • Get more from this author

Posted in Financial News, 31st August 2005 10:52 GMT

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Virgin looks set to beat arch retail rival HMV by a nose when it launches a revitalised UK music download service this week.

Virgin Digital UK will go live on Friday, 2 September, the company said yesterday. HMV's rival service, HMV Digital, opens its virtual doors on Monday, 5 September.

Ironically, both ventures are founded upon digital music distributor MusicNet's technology. Both target Windows Media-based portable music players.

Neither company is new to the digital music arena. Both firms were early customers of OD2, the digital music distributor co-founded by Peter Gabriel and now owned by US distributor Loudeye. Both Virgin's and HMV's early download services were lacklustre affairs, poorly marketed by the retailers.

Virgin announced the formation of a dedicated digital music division, Virgin Digital in March 2004, and launched a US service the following September. A UK launch was anticipated soon after, but it's taken a year to get the systems in place and for Virgin to be happy with the state of the UK music download market.

HMV's plans to revitalise its download service were revealed exclusively by The Register in June 2004, though the company did not formally announce its £10m programme until the following December.

Both companies are expected to promote their new services rather more aggressively than they have in the past, leveraging their high degree of music brand awareness and their crucial High Street presences. It's hard to see that not having an impact on market leader Apple, but the Mac maker is relatively insulated from the competition thanks to the close ties between the iTunes Music Store and the iPod. It's going to have more of an impact on rival Windows-based services such as Napster, which is likewise targeting the non iPod-owning consumers. ®

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