Nokia with Loudeye: serious threat to iPod and iTunes

Stuart Corner
Tuesday, 08 August 2006 20:20

IT Industry - Deals

Nokia has signed an agreement to acquire Loudeye, a global leader of digital music platforms and digital media distribution services for approximately $US60 million, saying that the acquisition will enable it to offer a music download service to its mobile phones, many of which are already multi-function music playing devices.

Loudeye operates 60 live services in over 20 countries and multiple languages across Europe and South Africa, Australia and New Zealand. It claims to aggregate rights and content from all the major labels and hundreds of independents and currently offers licensed catalogue and complete media for over 1.6 million tracks. It does not sell direct to end users but through its partners (in Australia, ninemsn).

Michael Brochu, president and CEO of Loudeye promised that "Our combined teams will deliver a comprehensive mobile music experience to Nokia device owners all over the world."

Nokia claims to have sold more than 15 million music enabled devices in the 2nd quarter, making it the world's largest manufacture of digital music players. Naturally, Nokia predicts that "the multi-function mobile device will become the preferred medium for enjoying music."

Nokia's new N series devices (Nokia calls them "multimedia computer") all incorporate a music player, high memory capacity, an FM radio, support for a multiple digital music formats including MP3, M4A, AAC and WMA.

According to Nokia, "you can quickly and easily find and purchase music over the air and download it to your device from your music store. Or, simply drag and drop your personal music collection from your PC to your Nokia Nseries device or synchronise your recent music purchases with your PC via Bluetooth or USB cable."

There has been much talk of an 'iPhone' from Apple - a combined iPod and cellphone - and an a partner from the cellphone world, and this latest development from Nokia makes that even more inevitable. However Apple has a lot of catching up to do to get to where Nokia is with its N series.