Yahoo! Gets Behind Rhapsody

It had been rumored for months that Yahoo! was going to get out of the subscription music business. Yesterday, they announced that they were shutting down Yahoo! Unlimited and turning over the subscriber base to Rhapsody. Yahoo! also announced that they are buying the Firefox plugin called FoxyTunes. The coolest thing about FoxyTunes is their web service called FoxyTunes Planet which is like a netvibes for music. Here’s the FoxyTunes Planet page on the Magnetic Fields.

I see this as a recognition by Yahoo! Music that the subscription business is tough and that’s its easier to build a business on top of the music and other music related services that are already out there on the web.

The most interesting thing to me is Yahoo!’s new blog music player which is an acknowledgement that mp3 blogging is a big deal. Imagine if that were the first step in building a music service on top of the blogs? Like Hype Machine? Of course, the best thing for them to do is buy the Hype Machine.

But all of this assumes that Yahoo! is going to continue as a stand alone entity which doesn’t seem that likely right now.