Real Networks and Viacom are reorganizing Rhapsody, their joint-venture music service, and will be spinning it off into an independent company, they told the Securities and Exchange Commission today. Rhapsody, along with Best Buy’s Napster, sell music via monthly subscription, as opposed to Apple’s a la carte download offering. But neither service has been able to gain much traction, despite years of effort. More shortly.

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Book publishers itching to raise the prices on their e-books should pay attention to the music labels, which raised the prices on their downloads last spring. Consumers, it turns out, like paying less for stuff.

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A former Universal Music executive, now headed to Yahoo, explains concisely why his former employer and the other big guys are just playing out the string: CD sales are wasting away, and the digital boost they were counting on simply isn’t big enough.

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Barnes & Noble’s e-reader entry was supposed to have one big advantage over the Kindle–you could buy one at the retailer’s stores. But it has been a long time coming, and in the meantime, you may have heard about another compelling e-reader heading to market.

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Underwhelmed with last night’s Super Bowl ads? So are the people who paid for them. The majority of TV ad buyers say they think their spots are less useful than they used to be. That’s potentially good news for Google and the Web, but it will be a long time coming.

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Google got a second ad for free last night: A Vizio ad that promoted YouTube, along with a slew of other Web services. But the ad did a lousy job of promoting the company’s Internet-connected TVs. Pity, because it actually has something cool to pitch.

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Remember the whole Conan O’Brien/Jay Leno imbroglio from last month? Perhaps NBC wishes you didn’t. It has removed every episode of the show’s seven-month run from its NBC.com site, as well as Hulu. YouTube is pretty barren, too.

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Last month, we posed this question in a headline about FriendFinder Networks: “Are Investors Finally Ready for an Internet Porn IPO?” Today we know the answer: No.

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Apple has some 140,000 apps for its iPhone users. People who use phones with Google’s Android operating system have much less choice.

But here’s a consolation prize: Android users do get to use the coolest app in New York City. At least, according to the NYC Big App competition, which awarded its Grand Prize last night to WayFinder NYC, an Android-only app.

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Here’s another publisher publicly throwing its weight behind Apple–and against Amazon–in the e-book pricing war. Hachette Book Group says it will pursue the “agency model” for pricing e-books: It sets retail prices and the retailer gets a 30 percent cut. In more practical terms, this means Hachette’s titles will be getting more expensive, and the rest of the industry will be following suit.

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Little Boxee, the much hyped Web video service, played a cameo role at today’s Congressional hearings on the Comcast-NBCU deal. And as sometimes happens when Boxee and big media intersect, controversy ensued.

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Former Google sales boss Tim Armstrong has brought a slew of former colleagues with him to AOL, but this may be his highest-profile hire so far: Dave Eun, who has been in charge of content deals at Google and YouTube, will replace Bill Wilson, one of the last high-profile AOL guys from the pre-Armstrong era.

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It’s a pretty standard chain of events: New platform opens up, investors try to attach themselves to developers who want to exploit it. Thus, the AppFund, which says it will invest up to $500,000 in iPad-specific apps.

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So, when’s that Hulu Premium service we heard about last fall going to show up?

If Disney EVP Kevin Mayer knows, he’s not telling. But for the record, he says, “no decisions have been made” about a pay service. Still, the site’s visitors will be asked to pay for something at some point.

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The music industry’s decline has been so prolonged that this now qualifies as a man-bites-dog story: Sony says its music sales actually went up, just a bit, in the last quarter. Thank Michael Jackson and Susan Boyle.

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