Before now Rhapsody, jointly owned by Real Networks and Viacom's MTV Networks, had focused on a subscription service, allowing unlimited song streaming for $13 to $15 a month, rather than selling downloads.
But Rhapsody Vice President Neil Smith said the fact the service has not been compatible with Apple's top-selling iPod digital player has limited Rhapsody's reach.
"We're no longer competing with the iPod," Smith said. "We're embracing it."
Rhapsody also will be the music store back-end to MTV's music Web sites and iLike, one of the most widely used music applications on social networking site Facebook.
Rhapsody will be available on mobile phones via the Verizon Wireless VCAST Music service. Buyers of a song over-the-air directly from phones also will be able to download that song to their computer. Verizon Wireless is a joint venture of Verizon Communications and Vodafone Group .
Rhapsody executives describe the strategy as "Music Without Limits." They said it would be backed by a marketing blitz worth up to $50 million in media space over the next year in part by leveraging co-parent MTV's TV networks and Web sites.
Rhapsody is the latest player to challenge iTunes's 70 percent-plus market share of U.S. digital music sales.