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BT is reported to have stepped up efforts to launch a new online music streaming service.

According to the Sunday Times, industry sources say the phone, TV and broadband provider is making a concerted effort to get the initiative off the ground.

The news provider suggests BT's broadband consumers could gain access to unlimited song downloads later this year, following talks with a number of record labels.

Plans for a music streaming service - to rival those offered by other broadband providers - were originally unveiled in November 2011.

Gavin Patterson, Chief Executive of BT Retail, revealed the firm was keen to move into this area, although the business model "would have to make sense".

He added: "We have offered to set aside our margins to get this off the ground, but much will depend on how eager the music industry is to work with us."

BT will be well aware that Sky tried - and failed - to establish a foothold in the market, which continues to be led by Apple.

The satellite TV and broadband provider launched its Sky Songs service in October 2009, to much fanfare. For a monthly fee of £4.99 per month, subscribers were able to choose from an extensive library of five million tracks.

However, the service experienced low customer demand, forcing Sky to pull the plug in December 2010, a little over 12 months after opening for business.

BT will be looking to avoid making similar mistakes as it bids to enter what is an increasingly lucrative market.

The likes of Orange, Vodafone and Virgin Media are already active in this field, and BT will be eager to avoid falling too far behind.

With sales of CDs continuing to fall as more music fans shop online, the digital music market is registering strong year-on-year growth.

And offering online music streaming services could potentially generate brand loyalty and boost the appeal of BT's home internet services - particularly among young people who are yet to sign up for their own broadband deal.

Speaking in the autumn, a music industry source suggested that BT's entry to the streaming market could be a positive move for all concerned.

"If the biggest broadband provider in the UK is looking at putting music in front of more people, that’s got to be a good thing," they told This Is Money.

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