Digital music service aims to pip iPhone

Music companies and mobile phone operators are hoping that a new digital music service with iPod-like characteristics will steal the thunder from the lauded Apple iPhone that is still more than six months away from hitting the shelves in the UK.

Unlike Apple's fledgling mobile phone product, the new service - called MusicStation - will not require consumers to shell out hundreds of pounds on a new handset. The service works on around 75 per cent of the handsets already used by western European mobile phone customers.

The service costs £1.99 a week: that provides for unlimited full-track music downloads from a database of around 1.2 million songs. It has been developed by the UK company Omnifone and has the backing of 23 mobile networks across 40 countries. Universal Music, the world's largest music company, has also signed up to the service alongside a number of other music groups.

The service will be launched at the 3GSM mobile phone conference in Barcelona today alongside a number of flashy new handsets from manufacturers intent on developing an 'iPhone-killer' to steal a march on Apple's new product that is not due to launch in the UK until November. Samsung will debut a new touch-screen phone called the F700 that also plays audio and video files, while LG is hoping to wow delegates with a new handset designed in collaboration with the fashion label Prada.

Rob Lewis, the chief executive of Omnifone, claimed: "The iPhone has clearly changed consumer expectations about what can be done with a mobile phone. MusicStation offers a genuine second choice to the Apple solution."

Rob Wells, the head of Universal Music's digital unit, said the service was "one of the most consumer-friendly and secure platforms we have seen".

Mr Lewis said MusicStation offers mobile operators a chance to boost revenue from music. He said users with 3G handsets spend around £6 a year on music compared with £100 if a customer subscribes to MusicStation for a year. He said at least two operators would launch the service in the UK, but declined to name its partners.

MusicStation allows for customers who use handsets with limited storage capacity to remove songs that were not popular with them.