Financial Times FT.com

Universal backs free music rival to iTunes

By Joshua Chaffin and Aline van Duyn in New York

Published: August 29 2006 03:00 | Last updated: August 29 2006 03:00

Universal Music, the world's largest music company, is backing a start-up that will allow consumers to download songs for free. It will rely on advertising for its revenues, offering a different business model from that of Apple Computer's popular iTunes music store.

The move reflects music companies' willingness to experiment as they try to capture some profit from the boom in digital distribution still dominated by illegal file-sharing networks.

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