Rhapsody Takes On Apple's iTunes, Online Music Heats Up

Offline playback is now available with Rhapsody on Android phones. But will that news be overshadowed by Apple's big iTunes announcement tomorrow?

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Rhapsody, the subscription digital music service with more than 10 million tracks, today announced that Android owners who use Rhapsody can listen to their music anywhere, regardless of a network connection. The company says it turns your Droid into an "MP3 player on steroids."

Previously, Droid owners who used Rhapsody needed to have an Internet connection to listen to music. Now users can cache their favorite music on their Droid (not to mention their iPhone), making it suddenly incredibly useful for subway rides and camping trips. "We believe all the music you could ever want should be at your fingertips at all times,” Rhapsody's Brendan Benzing said in a press release.

Record industry execs are increasingly distancing themselves from the free-music model exemplified by Spotify and Pandora. The world of digital subscriptions is shaping up to be the next major battleground in the music business, with competing providers jockeying to become the next iTunes.

Apple, of course, would like iTunes to be the next iTunes. We might learn tomorrow that Apple will be offering its own streaming service to compete with Rhapsody. Record industry sources confirmed to us last month reports that iTunes's Eddy Cue had been talking seriously with record labels about such a service. And now today, Apple's homepage features an enigmatic notice: "Tomorrow is just another day. That you'll never forget. Check back here tomorrow for an exciting announcement from iTunes."

If Apple is announcing a subscription service, it could be a very lucrative business move. A study by the NPD Group in July revealed that 15% of U.S. iTunes users would pay at least $10 a month for such a service-- which doesn't sound like that much until you realize it's worth $960 million in revenue.

[Image: Flickr user crabchick]

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