Reports suggest that Yahoo! is about to launch a new digital store, and an iTunes-style player.

Sources told that Yahoo has been working with digital-music wholesaler MusicNet for some time. It is thought that MusicNet will provide downloads and subscriptions to run along side jukebox software Musicmatch. Yahoo! bought Musicmatch last September for $160 million.

At the time of the Musicmatch buy out Yahoo's Launch digital music's David Goldberg told ZDNet: "We're making a big investment. We want to be the major player in digital music."


The Musicmatch buy brought Yahoo jukebox software, a music download store, a premium Net radio service with more than 160,000 subscribers, and a subscription service. It has also been suggested that the purchase keeps Musicmatch out of the hands of other large companies, which could become significant rivals to Yahoo.

The new MusicNet-powered music service will be integrated into Yahoo!'s existing infrastructure, possibly including features such as links to its popular instant-messaging program, sources said.

GartnerG2 analyst Mike McGuire told Silicon: "Given Yahoo!'s traffic and their very active communities, the potential [for success] is there."