AOL Planning an Enhanced Music Offering

America Online Inc. is beefing up its music services, adding specialized radio stations and a promotional outlet for lesser-known artists.

The moves, which are expected to be announced today, are part of the online giant’s efforts to create a complete environment for finding, listening to, experiencing and buying music and related products, said Kevin Conroy, head of AOL Music.

That environment eventually will include the ability to buy packages of songs for a flat monthly fee. But AOL’s main supplier for those songs, Seattle-based MusicNet, hasn’t yet lined up licenses from the two largest labels. Nor has it announced any licensing deals with music publishers.

The new AOL initiatives are “a step in the right direction,” said analyst Mark Mooradian of Jupiter Media Metrix, a technology research and consulting company. But they won’t satisfy the demand for downloadable music that’s driving so many consumers to online song-swapping services, he said.

“If I were a media site, I’d be terrified about what AOL is doing right now,” Mooradian said. “It means AOL is getting into music in a big way, and if we live in a world where subscription services are the norm, [what’s] the best place to succeed in that world? AOL . . . by more than a few lengths.”

The first of the new AOL initiatives is the Artist Discovery Network, a promotional outlet for bands without record contracts, music from independent labels and artists newly signed to major labels. Due to be launched today, it will include audio and video feeds from live music clubs around the country.

The second initiative is Radio@AOL, which is expected this fall when AOL releases the next major update of its software. The more than 50 channels will include some exclusive offerings from artists and AOL programmers but won’t offer any personalization or on-demand listening, Conroy said.

The updated software will include an improved tool for finding music online and a built-in CD and media player. The point, Conroy said, is to bring a full range of music-related activities to a single place assembled and managed by AOL.

The company already operates Spinner, a popular online radio service, and Winamp, maker of a software program for playing MP3 files.