MySpace turned it up to 11 today by launching MySpace Music, a joint venture we first heard about back in April between the social networking giant and the big four music labels. As a dedicated new section of the main MySpace site, MySpace Music offers a five-million-strong catalog of songs for free web streaming or for purchase as MP3s from Amazon. The record labels are placing big bets on this move, so we spoke with Steve Pearman, MySpace's SVP of Product Strategy, about what this means for the music industry and the MySpace community.

Since MySpace was founded in part on helping musicians get their songs in front of an audience, MySpace Music feels like a natural evolution for the site. Independent artists have long been able to upload their music; users could add the streaming tunes to their profiles or, more recently, download them. But today, MySpace joins others like Rhapsody and imeem in the web streaming movement by adding a healthy catalog of major artists from all four of the big labels, as well as independent distributor The Orchard. Unfortunately, however, MySpace Music is currently available only to US users.

All songs are completely free to stream in their entirety, and a new Flash music player embedded across various areas of the site allows for browsing the entire catalog or tracks from a particular artist. Songs can be added to a top 10 list (for display on one's profile) or to an unlimited number of custom playlists (which can only hold 100 songs each). For you closet pop music fans, playlists can be kept public or private so you don't have to let others find out about your Pussycat Dolls obsession.

"You're effectively building a music collection here, but they're all up in the cloud," Pearman told Ars. "Previous models have been about scarcity and building walls around content. Subscription services were cool but didn't work on the one device that everybody had. We figured that there was a model around building a business and opening content up."

Monetizing the music



MySpace will, of course, rely heavily on advertisements displayed while rocking out to music, but it has also partnered with Amazon to incorporate an MP3 store for purchasing tracks. Each song can be purchased as a DRM-free MP3 download, and Amazon's optional PC and Mac-compatible downloader allows songs to be effortlessly shuffled into iTunes and Windows Media Player. Users don't need to use this downloader, however.

With the launch of these new features, MySpace did its best to boost the odds for the labels by integrating the music experience across its entire site. When visiting an artist's or friend's page, any single embedded in his or her profile can be added to your own playlists with a couple clicks. A "Featured Playlists" section will highlight not just what's on top artists' iPods, but playlists from MySpace users who "make kickass playlists."

During the purchase and download process from Amazon, artist merchandise like t-shirts and coffee mugs are recommended, fulfilling MySpace chief executive Chris DeWolfe's statement of "monetizing [the artists] in five or six different ways."

When we asked Pearman about the exact nature of MySpace Music's joint partnership with the labels, he wouldn't comment. He would say, though, that MySpace music has been spun out to be "its own entity with its own staff. Its own company, really." This gives it "the liberty to try new things. The labels are on board to try and figure out what the future looks like."

When it comes to independent artists, however, things aren't as positive just yet. Ars has heard from indie distributors like Merlin and A2IM who are upset that they aren't being offered the same equity stake in MySpace Music that the major labels got.

“It is incredibly disappointing that MySpace will launch their new service without having finalized a deal with the world's most important independent labels and artists. It certainly makes Chris DeWolfe's public statements, that the 'indie bands are really the heart of MySpace,' ring extremely hollow," said independent label licensing collective Merlin CEO Charles Caldas. "What is absolutely clear, however, is that any independent deal struck without an equity component (as was done with the majors), will see independent labels face a situation whereby their major competitors will profit from the use of their repertoire without an appropriate upside opportunity being extended to them by MySpace Music and its major label equity partners"

It's no secret that, while digital music sales have been steadily rising, CD sales have slumped. But amidst a growing number of digital outlets with varying business models, MySpace already has a massive US user base of around 80 million users, all who now have unfettered access to a large catalog and the six degrees of product marketing that comes with it.