Yahoo! Music Goes Collegiate

Yahoo Music has snagged its first university customer, along with the potential to forge relationships with young consumers, in a deal with Stanford University announced today.

Yahoo will provide its Music Unlimited subscription service, which includes free downloads and commercial-free Internet radio streams, to students at no cost to them. The initiative follows in the footsteps of Napster, which has operated its “Napster on Campus” program since 2003, and those of Cdigix, a company that’s solely focused on media downloads on college campuses.

In the Yahoo program, if students want to buy and keep a song after they graduate, they can pay 79 cents a song or subscribe to Yahoo Music Unlimited at a discounted rate. Yahoo currently charges $4.99 to $6.99 a month for the service, depending on whether it’s billed monthly or annually.

The deal comes as the market for music downloads heats up with Apple’s unveiling of the latest version of iTunes yesterday. Stanford reportedly evaluated service offerings from several vendors and awarded Yahoo the contract.

“The scales were tipped in favor of Yahoo when the students on our evaluation committee, who test drove a number of different services, preferred the look and features of Yahoo Music Unlimited,” said Susan Weinstein, director of business development at Stanford University, in a statement.

Yahoo was not available to answer questions about the terms and length of the agreement.

Universities are receptive to legal file-sharing programs to cut down on illegal music downloads and minimize the drain on bandwidth. To accommodate campus demand, many music services now offer institutional licenses where download management is handled on campus servers, in some cases provided by an outside vendor.

Napster currently offers its music library to a number of universities, including the University of Washington, Penn State, the University of Southern California, and Cornell. Cdigix provides its Ctrax music service at Purdue University, Tufts, Duke and Yale.

As part of the Yahoo Music deal, Stanford students will be able to share songs via Yahoo messenger and transfer songs to MP3 players and other mobile devices.