In a bid to pump up its revenue stream, MySpace is pumping up the volume.
The unit of Rupert Murdoch's News Corp. announced Thursday that it has cut a deal with three of the Big Four music labels and plans to roll out a service that will let users discover, share and buy digital music.
The launch puts MySpace in competition with Apple's market-leading iTunes site as well as services like eMusic.com and the digital music download service launched by Amazon.com.last fall.
MyMusic will be a joint venture with Vivendi's Universal Music Group, Warner Music Group and Sony BMG, a joint venture of Sony and Bertelsmann. Financial terms of the partnership were not disclosed. Absent from the launch was the fourth major label, EMI.
MySpace grew to be the No. 1 domestic social-networking site in part because bands set up pages to let users sample music and build marketing buzz. The new service, to be rolled out in stages over the coming months, will follow Amazon's lead in letting users buy tracks without digital-rights management curbs. Users also will be able to listen to streaming audio and video on advertising-supported Web pages.
Despite the heavy online traffic it draws, News Corp. has struggled to pull revenue from MySpace's youthful audience. In its earnings report, News Corp. lumps MySpace, along with other online properties like AmericanIdol.com and its outdoor advertising unit into the "Other" category.
For the quarter ended Dec. 31, "Other" businesses posted revenue of $798 million, about 9 percent of the company's quarterly revenue of $8.6 billion.
By contrast, News Corp.'s movie unit, which released :"X-Men: The Last Stand,"The Simpsons Movie" and "Borat: Cultural Learnings of America for Make Benefit Glorious Nation of Kazakhstan," accounted for 23 percent of revenue.
Meanwhile, music labels, whose revenue has tumbled in recent years, continue to seek a fresh business model as single-track sales and illegal downloads gnaw at revenue.
“Millions of die hard music fans and artists already call MySpace Music home—by partnering with these industry leaders, our vision for MySpace Music as the definitive platform for unlimited artistic expression and unrestricted user experience is finally being realized,” MySpace Chief Executive Chris DeWolfe said in a statement.