Universal Music chairman and CEO Lucian Grainge said, "We see this as completely ground breaking. We've listened to our customers, our fans and our artists and we think that this is an opportunity to bring music to a wider audience."
Reuters reports that Virgin Media and Universal Music have announced a new music service that will offer Virgin Media Broadband customers the ability to stream and download to keep as many digital tracks as they won't each month for a set monthly fee.
People familiar with the service said it would cost in the $16 to $24 per month range. The music industry and the ISP both describe the service as a world's first. The tracks will be in MP3 format and use no DRM allowing them to be played on most music devices available including the iPhone and iPod.
Virgin Media will also be introducing new methods to its network to help reduce piracy. The plan by the ISP to reduce piracy will include educating users and as a last resort suspending access to those who pirate music and other media. Virgin Media does say that no user would be permanently disconnected from service.
Analyst Mark Mulligan said, "This really is high stakes, if this can't work then what will."
Music trade body IFPI welcomed the deal and said, "This is the kind of partnership between a music company and an Internet service provider that is going to shape the future for the music business internationally. It also marks new ground in ISPs' willingness to take steps to protect copyrighted content on their networks, and that sets a very encouraging example to the whole industry."
Some analysts say that for the offering to be successful Virgin will need to sign up other major record labels. Virgin says that by the time the service launches it will be able to offer a complete catalog.