MySpace seeks joint ventures for iTunes rival

MySpace, part of Rupert Murdoch's News Corp empire, is trying to tie up deals with a number of record labels to produce its own digital music service to compete with Apple's iTunes.

Tentatively dubbed MySpace Music, the service would let users of the MySpace site play music on their computers while logged onto the site. They would also be able to buy and download tracks free of copyright protection.

MySpace, which News Corp bought for $580m (£330m) in July 2005, is rumoured to have approached all four major music labels - Vivendi's Universal Music, Warner Music, EMI and Sony BMG about becoming involved in the service. But cutting a deal with Universal would be conditional on the music company and MySpace settling a copyright dispute.

The streaming music service would be paid from online advertising, with MySpace sharing a proportion of revenues generated through adverts with the music labels. Reports in the US media suggested MySpace could be used to sell band merchandise and possibly concert tickets, further helping the labels to make a return on their content.

There have also been discussions about using MySpace as a hub for a subscription-based music service with users allowed unlimited access to music for a fee.

Though it appears paradoxical, offering DRM-free music is seen by some in the music industry as a way of counteracting the problem of online music piracy as it removes the need to file-share by making music more portable.