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Today is the first day that an online music service created by Skype (News - Alert) founders Niklas Zennstrom and Janus Friis will be available to the public. The service offers users a monthly music subscription 'a la Napster,' and is the second attempt by Skype Limited to break into the digital music market.

 

The San Francisco-based online service, called 'Rdio,' is said to begin selling subscriptions today that provides access to over 5 million songs costing only $4.99 to $9.99 per month, according to the company's statement in a Businessweek.com article by Olga Kharif.

 

The name 'Rdio' stems from a combination of words - radio and audio - according to www.rdio.com.

 

Kharif explains that the founders of the seven year old 'peer-to-peer' communication tool are 'betting that consumers will opt for collections of songs that reside on remote servers, rather than a user's computer or phone.'

 

This may be especially useful when Internet or phone service is scarce, such as on public transportation.

 

'The music service will [also] include social features that let users read each other's reviews, browse other people's music collections and follow information about their favorite bands and friends' listening habits,' Kharif adds. Co-founder Friis noted that this service is much different than iTunes when he said that he believes 'the whole download model is going away' in a recent interview.

 

On Rdio Inc.'s website, however, the service still remains to be seen in action. Visitors to the site will find see the phrase 'Coming Soon' across the top of the page, and an invitation below to add themselves to an e-mail list that provides updates on when they can sign up.

 

The site also promises 'Unlimited access to music from your computer and mobile phone, even when you're offline,' which apparently also holds true for Blackberry and iPhone (News - Alert) users accessing the service.

                                                                                                                   

This service seems to stem from Kazaa, founded in 2001; a service Zennstrom and Friis introduced that allows users to share files (including music and ringtones) digitally. This project, however, does not let users access files offline, on MP3 players or on their smartphones like Rdio does.

 

These are not the only accomplishments from the duo - just four days ago the pair released a new version of its iPhone application available now to download from Apple's (News - Alert) App Store, according to a Business Wire article on TMCnet's 'Skype News' channel. Making and receiving Skype-to-Skype calls is finally possible for iPhone users who also wish to make mobile and landline calls for a very low rate, much like PC users have been accustomed to with the service.

 

Competition still remains stiff between online music vendors. Google recently said that it plans to begin selling digital tracks for smartphones based on their Android (News - Alert) software, according to Businessweek. However, you can bet that wherever Google or any other competitor does, Apple is not far behind so don't count them out, says Kharif.

 

Since the popularity of the smartphone - thanks to Apple and RIM, Inc., the possibility of those phones that are able to stream digital music has given not only technological companies a lucrative advantage, but record labels as well. Friis said that this technology gives companies a way to reach a new generation of listeners.

 

Forrester (News - Alert) Research reports that the digital music market generated $1.87 billion in U.S. sales in 2009 and the still-growing $209 million of that came from subscriptions to music services alone.