Digital Music Retailer 7digital Launching In U.S., Debuts BlackBerry App

UK music download retailer 7digital has beaten Spotify to launching in the U.S., in a move that undercuts standard iTunes track prices. The service has repertoire from all four major labels and a range of indies and is using a new BlackBerry service as a springboard for the move.

The company, which HMV (LSE: HMV) bought 50 percent of from VCs last month, first revealed its American ambition to paidContent:UK a year ago. Now, after inking the label deals, it is launching there with standard tracks at $0.77 (iTunes charges $0.69 for older songs, $0.99 for recent tracks and $1.29 for new hits).

U.S. music listeners already enjoy not just those services but also the likes of Rhapsody, Pandora and MySpace Music; but 7digital CEO Ben Drury, speaking at a launch event in London, said: “People keep thinking the market’s done, with iTunes and Amazon (NSDQ: AMZN), but there’s still a lot more to happen.”

“We think we can make this pricepoint work and still make a profit. “Most of our tracks are 320Kbps MP3 and we’re adding 100,000 a week. We think we have the broadest MP3 reach in the world, bigger than Amazon.”

The new store, with over eight million tracks, will be available over the web and to potential white-label services via its API, but is using a new BlackBerry app, built by DevelopIQ, to open the door.

Nokia (NYSE: NOK) has Comes With Music, Apple (NSDQ: AAPL) has iTunes, BlackBerry was missing a music service,” Drury said. “We’ve been working with the U.S. labels for a long time – we needed to wait for a window of opportunity – which is the BlackBerry launch. It’s huge in the U.S. – it’s big in Europe, but this was really the hook to enable us to launch in the U.S.”

The new app will boost BlackBerry’s own ambitions to target music fans and will be available on the Bold, Curve 8900 and Tour handsets in five countries, including the UK and U.S. 7digital’s app, available from and BlackBerry App World, lets users play tracks already stored on their handset, offers 64Kbp tracks over 3G, 320Kbps version over WiFi and streams snippets as well as offering full-track downloads and syncing with 7digial’s web locker.

Drury said 7digital had targeted mobile for some time but cited licensing complexity, handset capabilities and lack of data packages as barriers. “But we think that day has come,” he said.

Much-hyped Spotify has been seeking U.S. label deals and was hoping to launch there U.S. this Q3 or Q4. But, unlike Spotify’s model, which offers unlimited music plays with ad support or via subscription, 7digital’s is a conventional pay-per-track paradigm; Drury is still a believer in the traditional model.

Consumption of music is actually going up,” he said. “People will pay for something they value; there will not be one model.

“Spotify has some subscribers – we don’t know how manypeople are still not going to want to spend £10 a month on music; that’s definitely not going to happen.” How come 7digital beat Spotify to the punch Stateside? “Spotify’s is quite a new model,” Drury said. “And there’s talk of them having to do something different there.”

7digital actually already powers Spotify’s little-talked-about per-to-download add-on in several countries and, together with and Songbird, Spotify is one of 7digital’s top three retail partners. “We’re really happy w sales coming through from Spotify at the moment,” Drury added, reminding us that the partnership will soon improve Spotify’s pay-to-own option with “one-click” integration.

The ink is barely dry on HMV’s part-acquisition of 7digital, which will see the latter power all of its UK and Canada onlie music and video initiatives as well as ebooks and audiobooks for Waterstones. 7digital has taken off in the last year since it added an API, meaning it can power downloads for the likes of WinAmp, and even 45 million KitKat wrappers.