The jukebox may seem to be a vestige of an earlier time, before iPods and ringtones were the hot music markets. But don’t say that to Jason Rubin, president of A.J. Video Amusements in Baltimore, Md..

He is watching Internet-based music and now broadband connections enable his business to grow and conquer new markets with new services.

“Our business was pretty stagnant with CD jukeboxes,” said Rubin, whose company serves the Baltimore-Washington, D.C. metro corridor, including Northern Virginia. “We jumped on board with Internet jukeboxes and we’ve been riding a pretty healthy increase each year, both in terms of the number of places that would accept it, and our revenue stream.”

Rubin’s company is a customer of TouchTunes Music, the largest provider of digital jukeboxes, with interactive jukeboxes in more than 20,000 customer locations. TouchTunes most recently signed a national contract with AT&T to provide broadband connections to its customers that will enable them to offer a more varied range of content and services.

For instance, Rubin said, his company now allows customers to access a searchable library of 180,000 songs to choose a selection for an extra $1.

“The iPod trend is really driving that feature,” he commented. “People are getting used to the idea of downloading a specific song. We charge $1 for that feature, just like iPod, but you hear it one time and it’s over.”

With broadband connections, the searching is much faster, Rubin said.

TouchTunes is also introducing new software which will enable its customers to quickly change-out an entire jukebox for special occasions, such as a Reggae Night or Jimmy Buffet tribute, said Dan McAllister, vice president of sales for TouchTunes.

“They can log into their account and use our online management tool to change that music in a matter of minutes,” he said. “They can manage, and manipulate what they offer to serve their customers way better than they have in the past.”

The broadband connection is critical to that process, Rubin said.

“With dialup, we could change four songs a night – it took forever,” he said. “With broadband, we can do it in an hour.”

The AT&T contract enabled TouchTunes to offer its customers broadband connections at 1.5 Megabits per second that were affordably priced – at $30 or less – and readily available, McAllister said.

“Given the huge range of pricing across the country and its availability – our customers were really not migrating to it,” he said. “Some of it was pricing – it was going to cost $60 to $100 depending on what form of broadband they chose. In some ways that was cost-prohibitive. Given our own development and the significant software development we have coming in the fall and next year that really works better with broadband, we wanted to ramp up the broadband-capable jukeboxes.”

TouchTunes had talked with SBC representatives before the merger, and then re-engaged with AT&T in March.

“They understood our application immediately,” he said. “The guys we started with at SBC – they were gaining a tremendous amount of knowledge of our little industry, and they understood what we needed. They were able to provide us with more broadband connections than anyone else came to the plate with. From a nationwide standpoint, to launch this program was much easier with AT&T.”

TouchTunes is already growing at 100% per year as a company but expects even more growth from its broadband initiative and new software development.

“We plan to try to exceed 10,000 connections within the first 12 months,” McAllister said. “We hope to go well above that in the number of broadband connections. What broadband allows us to do is deliver music content and new applications much more quickly and more effectively.”

TouchTunes is in the process of creating a personalized digital music service that customers can log onto, at a digital jukebox in a public location, and search music libraries and build playlists much as they to today on personal computers.

“The playlists would follow them wherever they go,” he said. Customers could also create buddy lists and contact friends to invite them to the location – a restaurant or bar – to share the experience, he added.

Rubin has found another advantage to the AT&T-TouchTunes broadband connection. He’s connecting other machines used for playing games to the broadband connection as well, in including a Golden T Java-based game engine.

“They are not blocking the ports – they allow you to put whatever you want into that [DSL] router,” he said. “I don’t see any other deals like this in our market.”