The satellite giant has partnered with Universal Music for the joint venture that will enable internet users to download DRM-free tracks from artists including Amy Winehouse, The Killers and Snow Patrol.
Sky claims that service is a ‘world first' because of its combination of unlimited streaming, downloads to keep, access to the whole Universal Music catalogue and the fact that the music can be played on any device.
The broadcaster said that other music industry partners may soon join the service, which will launch later this year with its own brand and management team.
Sky hopes that providing a set number of downloads for a flat monthly fee will allow it to challenge Apple's iTunes service, which currently dominates the legal music downloads market.
The launch of Sky's joint venture initiative has been welcomed by analysts.
"There is a reluctance to pay for digital music downloads," said Jim Clark, senior technology analyst at Mintel. " If Sky can bundle downloads into its existing triple play packages it could clean up."
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