British satellite broadcaster Sky is teaming up with Universal Music to provide a subscription music service to allow users to stream tracks on demand and download them to a range of devices. Sky and Sony have also launched a digital video download service for PlayStation Portable owners.

The as yet unnamed music service will offer a subscription alternative to paying for individual tracks on iTunes, or simply copying music from elsewhere. It is likely to allow unlimited streaming plus a set number of downloads, which will be in the unprotected and universally playable MP3 format.

Initially it seems they will be limited to the Universal Music catalogue. Sky plans to partner with other major and independent music labels in the joint venture service which is planned for launch later this year.

Universal Music Group, a subsidiary of Vivendi, is the largest of the major music publishers, the others being Sony BMG, Warner and EMI.

Mike Darcey, chief operating officer at BSkyB, said it will offer “an easy and affordable service for all UK music fans, while ensuring that artists are properly rewarded for their creativity.”

“We have considerable expertise in customer-focused subscription services, content aggregation, packaging and marketing,” he said. “We have strong broadband services and online assets and we have contact with one in three UK households.”

Lucian Grainge, the chairman and chief executive of Universal Music Group, said “The new Sky service will provide a compelling digital music experience, built for the ever growing digital appetite of music fans.”

“In a world where a majority of UK homes have high speed broadband access, consumers will welcome a safe, state-of-the-art service and legal alternative to those services which exploit musicians without compensation.”

Music companies are keen to offer alternatives to Apple iTunes, which has over 70% of the digital music market in the United Kingdom, as well as a legal alternative to unauthorised distribution.

The Go!View service has been launched in partnership with Sony, allowing PSP owners to download premium programmes to their personal computer and transfer them for viewing on their portable player.

Programmes available include recent movie releases available for rental. The service is not limited to Sky subscribers but will initially only be available within the United Kingdom and Ireland.

Both initiatives indicate that Sky is continuing to extend beyond its core pay-television business into related digital media activities, exploiting its marketing presence and ability to package and promote subscription services, as well as its broadband network. The challenge will be to convince consumers to pay for streams and downloads in the way they currently pay for television subscription services.