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Nokia, Universal, Team up on Music Downloads

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LONDON (Dow Jones) Nokia, the world's largest mobile phone handset maker by sales, Tuesday said it had joined forces with Universal Music to offer unlimited music downloads for a year on phones bundled with its new Ovi web services platform.

The deal with Universal, the world's largest music company by sales, sees Espoo, Finland-based Nokia significantly ramp up its competition with Apple for consumers of music via mobile phone handsets. Nokia launched the Ovi platform and a set of multimedia services to hit stores ahead of the crucial Christmas trading period.

The service, dubbed Comes With Music, will allow users to keep the music after their yearly subscription charge expires, Nokia said in a statement.

Universal's artists include U2, Rihanna and Amy Winehouse.

Nokia said it was in discussion with other music groups about using their music.

"We set out to create the music experience that people are telling us they are looking for - all the music they want in the form of unlimited downloads to their mobile device and PC," said Anssi Vanjoki, Executive Vice President and General Manager for Nokia.

Speaking to Dow Jones Newswires later Tuesday Rob Wells, senior vice president of digital for Universal Music International, said Universal should get a significant uplift in music sales by volume as a result of the deal, despite slightly lower margins on a per-track basis.

Music bought via the service will be copyright-protected, Wells said, and users will be allowed to transfer tracks from their mobile handset to their PC and vice versa, but won't be able to make multiple copies.

He declined to comment on the financial terms of the deal.

The deal with Universal, owned by France's Vivendi, comes after Nokia in August launched Ovi, a platform designed to allow users to buy music and play games, in a bid to take on Apple's iPhone.

Nokia last year bought music portal Loudeye for $60 million to create the core of the service.

Nokia has also agreed deals on Ovi with mobile operators Telefonica and Vodafone Group, the world's largest mobile operator by sales.

Shares in Nokia fell slightly Tuesday as the company unveiled its targets for the next two years at its Capital Markets Day in Amsterdam, with some analysts saying it needed more aggressive margin targets to lift a stock that has performed well over the past year.

-By Jessica Hodgson, Dow Jones Newswires; +44 207 842 92 93; jessica.hodgson@dowjones.com

(END) Dow Jones Newswires

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Tags: telefonica  ovi  universal music  nokia,