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Virgin Digital, the online arm of the Virgin Group, will launch an online music service Monday aimed at replicating on the Net the success of its offline chain of retail music stores.

The company is jumping into the market with a full-featured music jukebox written from scratch, in which it is offering a music download store and music subscription service powered by wholesaler MusicNet.

With an entry 18 months after Apple Computer first launched its iTunes song store, Virgin is starting well behind its biggest rivals. But the company says it can use the powerful Virgin Megastore brand--and the access to the millions of customers who shop at the stores every year--as a way to reach out to mainstream consumers more effectively than competitors can.

"We wanted to look at feature sets that (are) actively represented (when) walking around a Virgin store," Virgin Digital President Zack Zalon said. "(Our rivals) are technology companies developing music services. We are a music company developing technology. We look at things differently."

With the move, Virgin becomes the first major offline music retailer to enter the market now dominated by software, hardware and consumer electronics businesses. As such, it could help test the viability of the bridge--if there is one--between the old offline world of music selling and the new digital medium.

Big record retailers have watched with trepidation as the online music market has developed. They saw the rise of Napster and other file-swapping services as a threat to their core CD business--but then saw the moves of record labels to create their own digital song distribution services in 2001 as another threat.

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Source: c|net