MySpace songs launch irks independent music group

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Mypsace, News Corp.-owned, opened the much anticipated Myspace music on Thursday and this will now give its 120 million users free access to hundreds of thousands of songs from the biggest recording labels.

On-site ads and the sale of songs through Amazon.com inc. MP3 downloading service will be the main revenue source for Myspace music. Sony BMG, Warner Music group Inc., Universal Music Group and EMI music brought their catalogs to the service, which is operating as a joint venture between them and Myspace.

Sony ATV/Music Publishing and The Orchard, a large independent music distributor, were also on board for the launch but neither company has equity stakes in the service.

There are other independent labels who want to be part of Myspace music as well but some of the executives from those companies are upset that they were excluded from the initial roll out.

Charles Caldas is the chief executive of the London-based Merlin, a music rights licensing agency, said that he is very disappointed with the launch because it seems like they have ignored their core

Merlin, which counts labels Epitaph, Koch Records and Tommy Boy among its members, are in talks with Myspace to get its members involved with the service, according to Caldas. Caldas said that he is still at odds to understand why Myspace launched it without his group's participation.

Caldas goes on and says that Myspace is a brand that built its strength and its power and diversity of the music it represents.

If Merlin does become part of the service but does not own equity than Caldas and others are concerned that the major labels could profit from their success.

Bob Frank chairs Merlin and is chief executive of New York-based Koch records and he said that it is shocking that the major labels will benefit from their equity from the utilization of their content.

Tom Anderson, Myspace co-founder and President, said that Myspace is trying to make deals with every independent music aggregator and that even includes the ones who are voicing complaints.

Anderson said that there is defiantly no one on his side that wants this to be a major-label only service and that they have already got indie content and they want more indie content.

Merlin wasn't included at the launch time because the parties had not reached a deal yet, according to Anderson.

Anderson did say that it is a two way street and that the possibility of major labels profiting from the success of independent artists on the site id there. A good example is that if Myspace features an independent or unsigned artist next to a major-label artist like Carrie Underwood, than that helps drive traffic to the non-major label artists too.

Russ Crupnick is an analyst for the NPD Group entertainment and he said that Myspace handled its launch in a sensible way.

Crupnick said that the reality is that the majors are the majors and if you don't have Sony and universal participating in this, than you don't have a service. Crupnick goes n and says that over the long haul it's really going to be incumbent on Myspace to provide some kind of equitable solution to everyone else.