The Telegraph is reporting that the BBC is developing an on-demand music service called Playlister, which will provide access to "hundreds of thousands" of tracks for free.

While it sounds like a direct rival for the likes of Spotify and Rdio, the newspaper's numbers suggest that the service would provide a fraction of the songs offered by the pay-for services—but it would be free. It's not really clear what tracks would be offered up: original versions, BBC archive material, something else entirely? It's anybody's guess.

The BBC has spoken about offering up its archive of music recordings for wider consumption in the past, but usually struggled to obtain the rights with which to do so. Apparently the organization has been talking to Spotify about how to side-step the problem, though—so perhaps it now has things sorted.

The newspaper speculates that the service could launch later this year or in early 2013, and it's not clear whether it would be a UK-only or international service. The BBC is apparently holding a digital media press conference this week, though—so we might find out more soon. [Telegraph via Musically via Verge]