MySpace to launch music site with record companies

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In the latest effort by the music industry to stop losses, three out of the ‘Big Four’ have struck a deal with the social networking site MySpace to start a music website.

As part of the deal, MySpace will spun out its Music service as an independent joint venture with Universal Music, Sony BMG and Warner Music. EMI, the forth major label, is not part of the deal but they are in negotiations saying it would join soon. All three music companies signing up now will have minority stakes in the company.

Visitors to the site will be able to listen to the music for free via streaming with advertising and are allowed to create customized playlists with their ‘friends’. They will also download the tracks to play on mobile and audio devices, putting it in the competition with similar music stores from eMusic, Amazon and Apple.

The subscription-based component of the site will see users paying a monthly amount to download unlimited tracks, rivaling eMusic, is being considered.

Terms of the deals and details about the site, like the price of the downloadable songs, were not disclosed but there is some good news. The songs that you download will not have any digital rights management (DRM) software. This means that you can play the music on any music player, including the iPod and the Zune.

Universal Music, however, has a pending lawsuit against MySpace for copyright infringement from 2006. It has not said that it has been dropped.

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