7digital Signs Sony BMG To MP3

U.K. download service 7digital.com has signed a deal with Sony BMG to sell around 250,000 tracks from its catalog in high quality MP3 format.

7digital says it is now the largest DRM-free store in the U.K., with a total of four million tracks. It has now signed up all the majors to the MP3 format following an agreement with Universal Music this month.

The London-based digital music service launched the Sony BMG catalog (Sept. 16) on its site today, in addition to launching new stores with localized content in Italy (it.7digital.com), Austria (at.7digital.com) and Portugal (pt.7digital.com). A pan-European store also launches today featuring catalog that has been cleared for the whole of Europe; 7digital has existing services in the U.K., Ireland, Germany, France and Spain.

CEO Ben Drury also announced plans to launch in North America in the fourth quarter of 2008. No date is confirmed, although Drury told Billboard.biz they will open an office in San Francisco.

"We already operate in the U.S. in a small capacity on the business-to-business side," said Drury at a London press conference today. "As the market moves to MP3, the U.S. has become more interesting to us and we have been getting more [web] traffic in the U.S."

Drury says the American launch will focus on building through partners such as social networks and other companies. As well as selling tracks direct to consumers, 7digital also delivers audio and video on behalf of record labels, artists, film and TV companies, as well as retail and brand partners.

The download store has been a major advocate of MP3 and Drury says he believes the U.K. launch of an MP3 service by Amazon "will promote choice" for download formats and he predicts a "backlash" against digital rights management.

Around 200,000 customers who previously purchased Sony BMG music in the WMA format from 7digital.com will be able to upgrade the tracks to MP3. "I think that's a very consumer friendly thing for Sony BMG to do," said Drury.

He contrasted the 7digital approach to MP3 with the protected music files sold on Apple's iTunes store and other mobile and subscription services. "People are a lot more likely to purchase albums in MP3," said Drury, adding that the format has helped boost the average transaction on 7digital.com to £4.50 ($8.03).

"Consumers see DRM as somewhat of a hindrance when purchasing legal digital music," said Drury in a statement. "The availability of all of the big four music labels in high-quality MP3 is fantastic news for the UK music fan - everything they now buy from us they can be sure will work on all their devices. We've seen a huge increase in sales since making MP3 downloads available on 7digital.com."

The company also outlined plans for a new partner program and application programming interface (API).

The API platform will allow third-party developers to create their own download and streaming services. The partner program is designed for non-developers who can use widgets that can play music on Web Sites and blogs and provide a link for fans to purchase tracks at 7digital.com. Partners will earn commission for tracks and albums they sell.

The announcement follows U.K. supermarket chain Tesco's partnership with Warner Music U.K. to sell MP3s via www.tescodigital.com.

Tesco's service has all the majors on board and currently has 3.3 million tracks in total. Around half of them are sold in MP3 format.