Microsoft Stops The Music

WASHINGTON – Bill Gates (search) and Steve Jobs (search) have found something on which they can agree: The major music labels want too much money.

Less than two weeks ago, Jobs said the labels were "greedy" in hinting they wanted a bigger share of digital music sales revenues, and Tuesday Microsoft (MSFT) called off plans to launch a subscription music service. Royalty fees between $6 and $8 a month were being demanded by the labels, including Vivendi's Universal Music and (V) Sony BMG (SNE) , according to the Wall Street Journal. Microsoft has now "indefinitely postponed" its plans to launch a subscription service, according to the paper.

Sources told the Journal those rates are roughly what other subscription services pay.

Online music sales triple

An international music industry trade group reported the digital music market more than tripled in the past year to $790 million, to account for 6% of the industry's total sales of $13.2 billion. However, the growth was not enough to offset a drop in sales of CDs. Total sales for all music a year ago were $13.4 billion. Nonetheless, the report from the International Federation of Phonographic Industry was upbeat, saying "Booming demand for music on the Internet and mobile phones nearly offset the decline in physical formats." More and more people in a growing number of countries are turning to the new legal ways of downloading music on the internet or via mobile phones," said John Kennedy, IFPI's chairman.

Lycos begins makeover

Lycos Inc. announced the launch of Planet, a free service for building Web sites featuring Web logs, photos and slide shows. One feature, MyTV Player lets users create slide shows with swipes, fades, rotates and spins, and animated captions. Planet is available on Lycos's Angelfire.com and will also be added to Lycos.com in a few weeks, the company said.

PPL unplugs broadband over power lines

A Pennsylvania utility company will end its experiment to deliver near-DSL speed Internet access over power lines at the end of the month. PPL Corp. (PPL) said after a two-year trial, results the technology was "promising," but, "the combination of a competitive, marketplace and need for significant scale has led us to the decision not to proceed as a retail communications service provider," said David Kelly, president of the company. PPL will give its trial customers a $50 credit, "to ease the transition to another Internet service provider."