Preview of the new service is live now.

American Online has acquired digital music subscription service MusicNow, which the company is integrating into a new digital music store to replace its existing MusicNet@AOL service.

A preview of the new service, called AOL Music Now, is live now. It offers monthly subscriptions for $9.95, portable subscriptions for $14.95, and ala carte downloads for 99 cents.

Previously, MusicNet@AOL only provided ala carte download capability to AOL members who were also paying the additional music subscription fee.

The new service is entirely Web-based, meaning subscribers and ala carte buyers can access the service from any Internet-connected computer without needing to download any software.
All current MusicNow subscribers have been ported automatically to the new service, at the same pricing, and AOL sent each an e-mail notification of such. Neither MusicNow or AOL would say how many subscribers MusicNow currently has.

AOL is also in the process of porting its 450,000 subscribers from the MusicNet@AOL service to the new store. Subscribers will receive an e-mail from AOL notifying them of the change and inviting them to preview it. Current subscribers will be automatically upgraded to AOL Music Now, and will get to keep their existing $8.95 monthly subscription rate.

AOL recently relaunched its entire Web strategy to allow anyone access to its various portals and content previously available only to paying members. The AOL Music Now service will be integrated into its free AOL Music site as well.
MusicNow has a music library of more than 1 million songs licensed form all four major music labels, as well as various independents. It was previously owned by Circuit City Stores Inc.,
and is based in Chicago.

All 40 employees, included president Gary Cohen, will remain with the company. MusicNow will operate as a wholly-owned subsidiary of AOL.