Skype Kazaa Founders Unveil Rdio Music Service

(Updated) Created by the founders of Kaaza and Skype, Rdio is offering the first look at its much anticipated  streaming offering with an expanded private beta.  Designed to be a social music experience, all four major labels along with several indie aggregators are already on board.

Rdio is launching its preview program in the US, and expects to be available to the public later this year. The service can be accessed via the web or smartphones, and delivers unlimited, on-demand access to 5 million songs for a monthly subscription of $5 - $10.

Radio offers a variety of ways to discover music including personalized recommendations for new music based on listening behavior and on-demand artist-based radio stations. A matching tool can also scan iTunes or Windows Media Player libraries and add the music to the users Rdio collection. Collaborative playlists can be created and shared playlists on Facebook, Twitter and via email.

"No one has managed to elegantly integrate discovery and a high-quality music streaming experience, under one roof,” said co-founder Janus Friis. Rdio apps know what album or playlist the user and their friends are listening to and can sync music to the phone to play offline.

“The music industry’s transition to online distribution has been dominated by à la carte sales,” said Mike McGuire, vice president, research, Gartner’s Media Industry Advisory Services. “But, there’s a big opportunity for companies to create paid music services that are based in the cloud – especially as more and more consumers own smartphones allowing them to access their entire online music library via phone. The industry needs to continue to invest in these models to expand the market for revenue-generating opportunities and provide compelling alternatives to free content.”

Based in San Francisco, Rdio was founded by Janus Friis with Niklas Zennström and Atomico, a  technology investment group. The U.S. team is led by CEO Drew Larner and COO Carter Adamson. Rdio’s product team includes Malthe Sigurdsson, who is responsible for Rdio’s user experience and design, and Todd Berman, who leads engineering.

Editors Note: I've been promised a beta invite today. So check back later today for my "first look". I'll be tweeting some initial reactions as well.