• by December 15, 2004

Let's get one thing straight: Music downloads from online music stores or the Web to the PC, and then to portable digital players like the iPod, are a great thing. With a tip of the hat to McDonald's, "I'm lovin' it..." Now comes word of a scenario for music downloads via wireless phones.

Specifically, there is a deal between Melodeo, a privately-held Seattle-based company that markets an all-in-one portable music system, and Warner Music Group to sell wireless music downloads to specially configured wireless phones. The scenario enables users of these phones to shop for music on their mobile, download that music, and listen to it at any point in time via supposedly "high quality stereo."

Interesting plan, though I can't think of anything worse than listening to music through my phone. For one thing, I wonder about the quality. With the iPod and other portable MP3 players, one is virtually assured of crystal clear, amazing sound. Say you download a CD to your computer for transfer to your iPod. You can adjust and set the quality of the download to suit your tastes; the higher the quality, the most space the specific track or entire CD will take up on your player. We like that. What is less than desirable is listening to a tinny-sounding track playing through a phone.

What is more interesting is having the ability to order and download music via a portable music player directly to that player. That's the scenario we would like to see.

For its part, Melodeo says the downloads will first be available in Spain to nearly 20 million Telefonica Moviles customers. In Spain, for example, tracks cost more than $2 apiece and can take anywhere from 30 seconds to several minutes to download, depending on the wireless network. The fastest downloads occur via advanced 3G phones. It's anybody's guess as to when a critical mass of U.S. consumers will own so-called 3G phones.

The service is expected to be available in the United States next year. We are interested to see which wireless carriers will sign on. Melodeo, which has a global licensing deal, has the ability to offer music from the catalogs of EMI Group, Vivendi Universal's Universal Music Group, and Sony BMG Music Entertainment.

If the plan catches on in the United States, mobile commerce can't be far behind.

Separately, there is word today that Time Warner has agreed to pay an estimated $600 million to settle long-running investigations with the U.S. Justice Department and the Securities and Exchange Commission stemming from allegations of improper accounting in the company's America Online unit.

The New York Times is reporting that the settlement may be announced later today. The investigations arose from allegations over how AOL reported advertising deals and subscriber numbers. Time Warner representatives contacted this morning declined to comment.