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MySpace launches online music service

MySpace is creating a free music Internet service with major recording labels to go head to head with digital giant Apple, whose iTunes has just claimed the crown as world’s largest music store.

The leading social networking Web site on Thursday unveiled MySpace Music, a joint venture with Sony BMG Music Entertainment, Universal Music Group and Warner Music Group.

MySpace Music will build on the News Corporation-owned Web site’s MySpace Music Channel and weave new services into online profile pages of more than 5 million musicians.

Income methods will include selling digital music downloads buyers can freely copy, along with ring tones for mobile telephones, concert tickets and band merchandise.

“We look to music as an area where we want to do something huge; something historical,” My

Space chief operating officer Amit Kapur told reporters.

“We plan to really change the game entirely,” Kapur said.

The Music Channel, which was launched about four years ago, is visited by 30 million people monthly, MySpace figures show. The new service will be rolled out in the US in coming months.

Financial terms of the partnership with recording labels were not disclosed.

MySpace’s announcement came as data from industry tracker NPD Group showed that earlier this year iTunes topped retail colossus Wal-Mart as the world’s largest music seller.

“We are thrilled,” iTunes vice president Eddy Cue said.

Since Apple launched the online digital content store five years ago, iTunes has reportedly sold more than 4 billion songs and built the most extensive music catalog in the market.

Both announcements confirm a death knell for compact disks as music lovers embrace digital formats for MP3 players such as iPod and Zune, Silicon Valley analyst Rob Enderle of Enderle Group said.

Online retail champion Amazon.com entered the increasingly crowded online digital music market last year. Wal-Mart is among major US retailers that sell music downloads via the Internet.

Media giant Time Warner is considering offering an “all you can eat” music subscription service for US$5 a month, Enderle said.

“We are undoubtedly going to see more people move to provide the media now that more of these digital players are out there,” Enderle told reporters.

“It’s a natural for online social networks, because they provide ways to share play lists and songs broadly,” he said.

“It won’t be long before Facebook does something like this,” Enderle said.

MySpace, a hit with teenagers, has worked to make itself a platform for musicians famous or obscure to connect with the Web site’s millions of users.

MySpace has woven live concerts into its repertoire. A US concert tour headlining with the French music group Justice wrapped up on March 31.

“MySpace is trying to find its niche and maintain relevance,” Jason Miklian of Norway said as he and other fans packed into a MySpace Justice show in San Francisco last week.

“MySpace is like a gateway for musicians — you have to have a presence,” he said.

Enderle said he sees MySpace as getting more aggressive about “trying to create some breathing space between them and Facebook,” which is in second place but growing at a blistering pace.
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