Sony BMG signs up for Nokia's 'free music' scheme

Some estimate that Nokia's subsidy could run as high as $135 per handset if all the major labels back the scheme.

Sony BMG Entertainment is the latest record label to offer its entire music catalogue free on upcoming Nokia handsets

Nokia has signed up music giant Sony BMG Entertainment as the latest major record label to offer its catalogue on Nokia Comes With Music - the upcoming 'unlimited free music' bundle for Nokia handsets.

Sony BMG joins Universal Music as the second major label to back Nokia's ground-breaking music offering. Punters who buy a Nokia Comes With Music mobile will be able to download as much music from those companies catalogues as they want from the Nokia Music Store for 12 months free of charge

The tracks can be downloaded direct to the handset or to a compatible PC (the service doesn't work on Macs) and at the end of the 12-month period they can keep everything they've downloaded forever.

This is the key difference between Nokia's offering and previous subscription-style deals which saw the supposedly free music 'disappear' at the end of the offer period. If you switch to a non-Nokia phone or buy an Apple Mac your accumulated treasure of tracks becomes worthless overnight.

Of course, the music isn't being given away by Sony BMG and Universal. Nokia is paying a hefty fee to them for the privilege of running this undeniably appealing offer. Some estimate that the subsidy could run as high as $135 per handset if all the major labels back the scheme.

Nokia hopes to recoup some of that investment by persuading punters to pay for downloads or sign up for new paid-for subscription deals once the 12-month musical free-for-all is over. But if Nokia doesn't get people back into the habit for paying for tunes they could end up significantly out of pocket - and profit.

Nokia Comes With Music handsets are due to go on sale in the UK in the second half of 2008.