New York (NY) - Sony, Vivendi, Universal and Warner are all expected to be part of the launch of a new channel of Myspace, allowing users to stream and download music tracks in a direct competition to other digital media stores.
Myspace Music will be an all-encompassing music destination, offering unlimited streaming, MP3 downloads, ringtones, and the opportunity to buy concert tickets and other merchandise.
"It's really creating a robust monetization component to MySpace and having a focused music effort that could be the MTV of a new generation," said an unnamed source familiar with the deal in a Reuters story.
The new partnership between Myspace and record labels underlines the push for new distribution of music. Some record labels have entered into revenue-sharing arrangements with sites like Youtube. Others have shown more interest in the mobile market with ringtones and "ringback tones." Physical CD sales continue to plummet and single-track downloads on places like iTunes fail to generate the kind of gross margin that CD sales have.
Declining music sales attributed to Best Buy's weaker-than-expected fourth quarter last year, and retail juggernaut Wal-Mart has now slipped as the top music seller in the country. The new leader is Apple's iTunes.
The idea of the new Myspace venture is to blend in an e-commerce platform with a community that is already one of the most frequently visited online environments in the world. By adding a digital music store to Myspace, which is visited by tens of millions of people every month, the immediate consumer base is already pretty huge.
The Myspace Music store is expected to launch next Monday.