Well, we didn’t think it would happen, but clearly it has – Apple has approved RealNetwork’s subscription music service Rhapsody’s application for the iPhone and iPod touch.

This is fairly significant, in part because it follows the widely-publicised approval of Spotify in some key European territories, and partly because it shows Apple’s happy to allow competitors to offer music streaming applications through its devices. In part, this could be to ensure open competition should the company ever decide to move into the subscription-based music space itself. Not allowing competitors to offer similar services on its platforms could be considered anti-competitive.

Rhapsody – US only – is available as a free application, but new subscribers will have to pay $14.99 per month if they choose to keep using it after the initial seven day trial period.

The offering makes 8 million songs available to stream via WiFi or 3G, so could be a nice way to explore new music and casually play half-remembered songs. Like Spotify, the company plans to allow subscribers to load songs over the air for later offline playback by the end of the year.

"This breaks us out of the non-Apple MP3 player segment and now we can reach the iPod Touch and iPhone audience that was unavailable to us before," said Neil Smith, vice president of business management for Rhapsody America.

The application also offers song purchase links for users who like a particular track. These songs are provided by iTunes with RealNetworks taking a slice of any income generated.

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