MTV, Real & Verizon Partner For New Rhapsody America Music Service

MTV today abandoned its URGE download store with Microsoft in favor of a new partnership with Real to be called Rhapsody America.  The new company has also contracted with Verizon for wireless delivery in a move to create a seemless "jukebox in the sky" and compete with the hugely popular iTunes.

No launch date has been set and pricing and details were vague. But the executives did  promise  to combine the best of Real’s Rhapsody (which will be folded into the new service) , URGE’s former features and some Verizon V-Cast services.  It is also clear that the combined marketing muscle of these three companies will be thrown behind the new service."We firmly beliee that 1 plus 1 plus 1equals more than 3 here." said Van Toffler of
MTV during this mornings conference call.

MTV said that it was still in negotiations with Microsoft to finalize the split and that URGE would continue to reside on Windows 11 for now.  That piece of coveted desktop real estate will probably go to Microsoft’s Zune even though it has did little to help URGE.

• More details in the joint press release after the jump
• Notes from our live blogging of the conference call can be found here.
• A telephone replay of the call is available (after 12:30 EDT) at 1-888-484-8256 and 1-203-369-3737 for international callers.

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PRESS RELEASE: MTV Networks, RealNetworks and Verizon Wireless Join Forces
To Offer A New Integrated Digital Music Experience

NEW YORK – Aug. 21, 2007 – RealNetworks, Inc. (NASDAQ: RNWK), MTV Networks, a division of VIACOM International (NYSE: VIA.A and VIA.B), and Verizon Wireless, a joint venture of Verizon Communications (NYSE: VZ), and Vodafone (LSE: VOD) today announced they are teaming to create a single, integrated digital music experience that consumers can access via their PC, portable music device or mobile phone. Promising to be ultra-rich in music culture, programming and discovery, Rhapsody will unite the best of RealNetworks’ market-leading service and MTV Networks critically acclaimed URGE music service. Verizon Wireless’ V CAST Music –the most successful mobile music service in the country – will become the mobile platform for the integrated Rhapsody service.

As part of this alliance, MTV Networks and Real are forming a new company, Rhapsody America, whose offering will be the exclusive digital music service for Real and for MTV Networks’ premier music and pop culture brands in the United States.  Both partners will bring complementary strengths, including MTV Network’s storied history in music programming, unparalleled connection with music fans, and youth marketing prowess, with Real’s innovative technology, market momentum for Rhapsody, and deep relationships within the consumer electronics industry. Michael Bloom, previously General Manager of MTV Network’s URGE, will lead Rhapsody America, which will have offices in New York, Seattle and San Francisco.

Real and MTV Networks, through their Rhapsody America venture, have formed a long-term, groundbreaking and exclusive relationship with Verizon Wireless, in which the companies will be partners in bringing consumers digital music to their PCs and over the air to their mobile phones. Through the relationship with Verizon Wireless, Rhapsody will be fully integrated with VCAST Music, delivering a superior music service across multiple consumer devices.

“With RealNetworks and Verizon Wireless, we’re creating a unique and engaging experience that also reflects our own strategy of allowing fans to go narrow and deep into the musical genres they love,” said Judy McGrath, Chairman and CEO of MTV Networks. “Any time we can partner with industry leaders like this to create a new music proposition, everyone wins, especially the audience.” 

“Today’s announcements represent a sea-change in the digital music market,” said Rob Glaser, chairman and CEO, RealNetworks. “By partnering with MTV Networks, home of the most storied brands in music history, and the market’s leading wireless company, Verizon Wireless, we’ll make Rhapsody the premier digital music service that delivers great music to millions of consumers whenever and wherever they want.”

“By bringing together the cultural and musical heritage of the MTV Networks family with the functionality of Rhapsody and the reach of V CAST Music, it’s like we’ve put the best lead singer, drummer and guitarist all on the same giant stage, allowing music fans to experience the purest music play in any way they want,” said Van Toffler, President of MTV Networks Music & Logo Group. “The new Rhapsody will build on the musical curation of URGE and have the marketing power of MTV, VH1 and CMT behind it, ensuring this new platform is front and center in the hearts and minds of music lovers.”

John Stratton, executive vice president and chief marketing officer of Verizon, said, “Our commitment to innovation and making V CAST Music the #1 mobile music service in the country has led to today’s momentous announcement. Verizon’s alignment with these two great companies – MTV Networks’ music and youth marketing expertise with RealNetworks’ acclaimed service and technology – promises to propel digital music into an exciting new future.  Together, our three companies will provide a new, unbeatable digital music experience that will give every consumer a way to get music quickly and easily – whether sitting in front of a computer screen or on-the-go with a mobile device.”

Real, MTV Networks and Verizon Wireless will leverage their complementary strengths to bring the new service to market and back it up with an aggressive advertising and promotional campaign. Verizon Wireless will market Rhapsody through its extensive network of Verizon Wireless Communications Stores nationwide when the service launches on mobile phones.  Rhapsody will become the music service of choice across MTV Networks’ MTV, VH1, and CMT brands and their myriad of online youth-culture touch points. On-air integration for the new service will begin next week and Rhapsody will also be integrated into the fabric of MTV’s marquee event, the Video Music Awards airing live from Las Vegas on September 9th.

Customer Experience

Starting today, URGE customers can use their existing usernames and passwords to log in to Rhapsody and enjoy access to both services. In addition, Rhapsody customers can get their first taste of MTV Networks’ rich programming from MTV, VH1 and CMT. Verizon Wireless customers can already download music instantly to their V CAST-enabled phones at any time and from anywhere in the V CAST service area and transfer digital music to their phones from their PC. In the months ahead, Verizon Wireless will roll out functionality that sends the duplicate copy of songs purchased over the air directly to a customer’s Rhapsody account.  The service will also allow transfer of subscription music from a Rhapsody account to a mobile phone.

Rhapsody will also continue to be offered through RealNetworks’ extensive network of partners, including Best Buy, SanDisk and TiVo.

Press Teleconferences
Today’s news was announced this morning at a press teleconference by executives from RealNetworks MTV Networks and Verizon.  Replays of the teleconference will be available at 1:00 p.m. ET/10:00 a.m. PT via a toll-free call at 1-888-484-8256 and at 1-203-369-3737 for international callers.