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just to expand on what you already reported on...
SEATTLE (Reuters) - Starbucks Corp. on Friday said it will launch a new service next week that will allow customers to create and buy CDs with songs chosen from a digital music library inside the coffee house.
The new service, which will debut on Tuesday at a Starbucks outlet in Santa Monica, California, has been created through a partnership with computer maker Hewlett-Packard Co., the companies said in a press release. No details were provided.
BusinessWeek magazine on Thursday said the service would offer 250,000 songs and would expand into 2,500 Starbucks cafes over the next two years.
The music business, dubbed Hear Music Cafe, could provide a significant boost to Starbucks revenues, according to Smith Barney analyst Mark Kalinowski.
"We calculate that if Starbucks can get 5 percent of its customers to spend $10 on music annually, it would add one to two full percentage points to overall revenues," Kalinowski said in a research report.
Seattle-based Starbucks posted revenues of $4.1 billion in its fiscal year ending last September, up 24 percent on the year.
Shares of Starbucks were down slightly in afternoon Nasdaq trade on Friday while HP shares were up 1 percent on the New York Stock Exchange.
Starbucks currently offers a limited selection of music CDs in its stores. The company is also in a partnership with T-Mobile that put high-speed wireless Internet connectivity, or WiFi, into hundreds of its U.S. stores.
Palo Alto, California-based HP, with its lucrative and well-known imaging and printing business, has moved into digital cameras, photo printers, and myriad other consumer gizmos as it seeks to become an even bigger consumer brand.
(Additional reporting by Duncan Martell in San Francisco)
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