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Slacker Wraps Up More Music Licenses

9/24/2007 12:41:00 PM Eastern

San Diego — New music-licensing agreements have enabled start-up Slacker to expand the selection of songs available for playback through a music-streaming service that lets users store streamed content on a planned Wi-Fi-equipped MP3 player for playback away from the computer.

With Slacker’s expanded music catalog, consumers will be able to create more than 100 personalized Internet radio stations, record the streams on a PC or Mac, then transfer the content via USB to a planned Slacker portable player. Streamed music can also be pushed directly to the player via Wi-Fi for storage. Content will be refreshed automatically when the user is in range of a Wi-Fi network.

Earlier this year, Slacker reached an agreement with Sony BMG Music, but the start-up has now struck agreements with the remaining big four music companies: EMI Music, Universal Music Group and Warner Music Group. Slacker also announced deals with independent labels and distributors, including IODA, The Orchard, Beggars Group, Matador Records, IRIS, Ubiquity Records and Sanctuary Group PLC.

Slacker “brings discovery, choice, mobility and community to the music experience while compensating record labels and artists for their works,” said Michael Nash, Warner Music senior VP. Universal Music Group executive VP Rio Caraeff likewise said the service is “designed for consumers who value the ability to explore a wide variety of music across many genres.”

The number of songs available through Slacker service is currently in the millions, the company said without getting specific. A few months ago, the company also contended its selection was in the millions.

Slacker executives say they’re targeting people dissatisfied with satellite radio and MP3 players. Satellite radio is not personalized enough for these consumers and is limited in portability, while MP3 players are very portable but require users to spend too much time refreshing the content, they contend. These consumers, the company believes, prefer the personalization of Internet radio and would be eager to use it in portable applications.

For these consumers, Slacker plans a delayed fourth-quarter launch of a Wi-Fi-connected portable MP3 player that stores music streams from the company’s free, advertiser-supported personalized streaming service and from a planned ad-free subscription service. The company previously targeted a June launch.

Consumers tune into the streams from any browser-equipped broadband connected PC, but when they’re away from a PC, they can listen to the recorded streams on one of Slacker’s portables. The players will also be shipped with cached stations for out-of-the-box playback.

Slacker also plans a car kit with car-top antenna that enables a docked portable to receive free automatic updates in the continental United States via Ku-band satellite transponders leased by the company. Users of the free and premium services will be able to get the free updates from the satellite transponders, which will push a new song to a player about every 10 seconds for about 10,000 new songs per day. Shipments of the car kit had been planned for the second half, but now the company said it’s “coming soon.”

The players also store MP3 and protected and unprotected WMA songs transferred from a PC. The devices are compatible with authorized WMA subscription download sites as well.

Slacker’s free service is already up and running at www.slacker.com, and the launch date of the $7.50/month commercial-free premium service has been postponed from a previously announced June. A new launch date was unavailable.

Both Slacker services offer up to 100 stations programmed by genre and more than 10,000 stations organized by artist. Users gradually personalize each station by clicking on a “love it” or “ban it” button while listening to a particular song. The user’s station then automatically refreshes itself with songs more to the user’s liking.

The free service comes with commercials and ability to skip up to six songs per hour per station, per licensing agreements with the music industry. The premium service, on the other hand, lacks commercials, allows unlimited skipping, and lets users save individual songs for anytime playback on a PC or portable device as long as the user’s subscription is paid up.

The portable devices will be Slacker-branded and will include flash-memory and hard-disk models priced above and below $200, a spokesman said.

Later in the second half, Slacker will offer music downloads in protected-WMA format at $1 a song. These songs will have more liberal usage rules, including allowances for sharing on additional PCs and burning songs to CD.

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