MySpace Music Launches With Major Labels

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Social networking giant MySpace has finally unveiled MySpace Music, its long-gestating digital music service that will compete with the likes of Rhapsody and Apple’s market-leading iTunes service. And MySpace Music managed to pull a last-minute coup, bringing all four major music publishers on board (including EMi, which had been holding out) along with Sony and Michael Jackson’s Sony/ATV and independent music distributor The Orchard.

Although MySpace Music emphasized the current debut is just the first phase of its business plans, the new service offer free and unlimited ad-supported audio streaming, free playlist functionality, discography and catalogs from Universal, Sony BMG, and Warner Music artists, ringtones by Jamster, and DRM-free music purchases in MP3 format powered by Amazon’s MP3 store. The service will also offer music discovery services, and the ability to "virally" add a friend’s playlist to their own profile, or snag songs from a friend’s profile for their own.

MySpace’s streaming service enables users to stream their preferred music content through a personal player while browsing MySpace or other sites. MySpace users will also be about to search for music by artist, title, and album, and (of course) purchase DRM-free MP3s from a variety of locations within the MySpace universe, including artist profiles, user-created playlists, and even some editorial content.

Major advertisers onboard for the MySpace Music launch include Sony Pictures, State Farm, Toyota, and McDonalds; MySpace is keen to let music publishers know that they plan to open a number of ecommerce and "monetization" opportunities within MySpace Music, leveraging what they believe to be their "deep, long-standing ties to the music community"—including the 5 million+ "artists" who have profiles on the site. However, at least at launch, MySpace Music has yet to make deals with a vast number of independent labels: their artists’ music might actually be up on MySpace, but they don’t get to participate in MySpace Music.

MySpace Music is being operated as a joint venture with the major music labels, with each label’s share of the business roughly proportionate to its worldwide market share. That would make Universal Music—the same company that extorted a dollar out of Microsoft for ever Zune sold—the largest label shareholder in the operation. MySpace Music is aimed to position itself as a socially-enabled alternative to iTunes, where used can easily discover music through their friends and profiles of people on the site…in contrast to Apple’s comparatively hygienic and isolated iTunes experience. And, of course, MySpace Music hopes to turn all that user interest in music into not only music sales, but an advertising juggernaut.

Eventually, MySpace Music plans to get into other aspects of the commercial music business, including ticket and merchandise sales.

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