The Wall Street Journal is reporting that Microsoft has broken off licensing discussions with EMI, Warner Music, Vivendi Universal and Sony BMG. The discussions had been focused on a new subscription model service that Microsoft is interested in offering.

Apparantly, the labels wanted too much money, asking for $6 to $8 per user per month. Yahoo offers a competing service for $5 per user per month, but supplements it with advertising revenue.

The labels expected Microsoft to go along with the same sort of business model. Microsoft must be thinking along different lines.