Digital store to launch later this year.

MTV Networks is expected to launch an online music service powered by MusicNet later this year, making it the latest big brand to enter an increasingly crowded market for online music, people familiar with the plan said yesterday (May 6).

Both MTV, a unit of Viacom Inc, and MusicNet, a joint venture of RealNetworks and three labels (BMG, EMI and Warner Music), declined to comment.

MTV has indicated before that it wanted to enter the digital-music arena, a market which is gaining momentum with the advent of popular services like Apple Computer's iTunes.

MusicNet is a business-to-business company that charges its clients fees for technology, infrastructure and its catalog of licensed music.

Its customers include Time Warner Inc's America Online and Virgin Group Ltd, which plans to launch an online music service in the United States and the United Kingdom by late summer, with other markets to follow.

It was unclear in which format the MTV service would offer its tracks or how much it will cost.

MTV hopes to use its brand awareness and clout with young music fans in a strategy similar to that of electronics giant Sony Corp, which this week announced a new online music service called Sony Connect, compatible with its mini-disc Walkman devices.

MusicNet was set up by major labels in 2000 in response to rampant online piracy and in a bid to promote commercial online music services.