Yet another UK music download company has bitten the dust, MyCokeMusic.

Launched with fanfare two years ago, the Windows-only OD2/Loudeye-backed service has told its customers it plans to shut up (digital) shop on 31 July.

It will continue to sell music until then in Switzerland, Ireland, Italy, Greece, Great Britain and Austria. This grace period is solely in order that existing customers can use any remaining song credits they may have, no new sales will be supported.

A note on the company's website explains: "In 2004, the digital music scene was just developing and the only way for Coke to offer access to music downloads was to open our own store. That's not true today and there is no need for Coke to continue to run a store."

Existing customers will also be allowed to transfer their remaining song credits to another OD2-backed service.

The news is seen as a negative sign for OD2. Industry insiders speculate that the closure may be connected to new distribution charges labels are levying against online music providers. Labels have demanded online services hand over a set fee in order to be given the right to distribute their music. This fee is additional to the per-track fee labels demand. The distribution fee has reportedly shot up by as much as 400 per cent in some cases this year.

Meanwhile, UK operator Karma Download has ceased trading, rumours claim its business has been transferred to TuneTribe.

Find - or begin - a discussion of this story in Macworld UK's busy Forums.