Yahoo! Acquires Musicmatch for $160m

Yahoo! has announced that it will acquire digital music company Musicmatch for $160 million in cash. With the addition of Musicmatch's Jukebox service to its portfolio, the move will help Yahoo! establish itself in the online music market currently dominated by Apple's iTunes.

Musicmatch recently launched Jukebox 9.0, which offers subscribers on-demand access to a library of 700,000 songs for a monthly fee starting at $7.95 USD. Musicmatch also offers 99-cent downloads like its iTunes rival, although the company has pushed its on-demand feature to differentiate itself.

Musicmatch currently boasts over 225,000 subscribers to its Jukebox service.

"Yahoo! is committed to being a major player in digital music," Yahoo! CEO Terry Semel said in a statement. "This combination bolsters our strategy to capture the largest audience of consumers as they make the shift to digital music."

With further investments planned in the digital music space, Yahoo! is digging in for a long fight against Apple and other competitors including a revamped Napster, RealNetworks and retail giant Wal-Mart.