Source: MySpace to announce new music service on Thursday
A new music service jointly owned by News Corp.’s MySpace and three of the record labels will be announced Thursday, according to a source with knowledge of the deal.
MySpace Music has been expected for weeks and will offer streaming music, MP3 downloads, concert tickets, ringtones, music for mobile and other merchandise, the source told CNET News.com. The source added that MySpace is hopeful that it can get the service running in the next few months.
The deal immediately catapults News Corp. chairman Rupert Murdoch into direct competition with Apple CEO Steve Jobs’ iTunes. Apple offers music and video downloads. The backers are hoping MySpace Music can compete against iTunes by providing MySpace’s 110 million worldwide monthly visitors a sweeping range of music services and products that eclipse iTunes’ offering.
The service also helps MySpace jump past such services as Imeem and Last.fm. Those social networks were first to stream songs free of charge to users. But now, MySpace will offer the same ad-supported streaming service but also sell downloads and the soup-to-nuts music offering.
MySpace Music will launch with music from three of the top four record labels: Universal Music Group, Warner Music Group and Sony BMG Music Entertainment. The only label that hasn’t agreed to the deal is EMI Music Group, a source told CNET News.com. MySpace and EMI executives are working around the clock to close the deal.
All the labels will receive a minority share in the company and a share of all the revenue generated from the site, according to the source.
Universal Music Group was thought to be holding up the service because of a copyright-infringement lawsuit that it filed against MySpace last year. MySpace has agreed to pay a “huge” settlement, according to Peter Kafka at Silicon Alley Insider .
Source: CNET News.com - Business Tech
This is a blatant attempt on the part of the labels to raid what was ostensibly a home for independent artists, but it shows how desperate they are to maintain their declining market power. And the fact that MySpace is willing to let them raid their user base shows that MySpace is not really serious about the independent market. So where does that leave the artists on MySpace, who will now have to cut through even more distractions as the majors spam and shill their artists all over the site? It’s looking bad for MySpace, in my opinion. Whether this is a competitor for iTunes or not is not the point. It’s understood that the labels don’t like Apple’s deal, they’re greedy and want to charge more money for their subpar product. That’s normal for them. What matters is that this changes nothing for the artists or the fans, and it may even be worse for both.