MySpace Buying iMeem: A Plan to Beat Spotify?

There are rumors abounding that MySpace is in advanced stages of trying to social-network music system iMeem, and they set us thinking.

There are rumors abounding that MySpace is in advanced stages of trying to social-network music system iMeem, and they set us thinking. Looking at Facebook’s tie-up with Lala, and even MySpace’s with iLike, is this all to outsmart Spotify?

myspace imeem

iMeem’s been in the wars a bit recently. Its business model of offering free streaming music to users and garnering income from targeted ad sales is a challenging one, and iMeem’s fortunes weren’t helped at first by the music industry’s punitive licensing deals. Once championed by Nielsen as one of the top social networks of 2008, the company is now a MySpace target so that the bigger company can grab the smaller’s tech to improve its own music offerings.

Peter Kafka at AllThingsD notes that this is a situation where “the last of the Web 2.0 music services are dwindling away.” And he’s kinda right…if you think about it, the plethora of Web sites that arrived as part of the Web 2.0 excitement, each offering a way to engage more with your music, and share and talk about it with friends, is reduced to a few big players. iTunes has snapped up the lead in online music selling, but as yet hasn’t included a streaming/subscription service of the kind that characterizes these newer sites. Is it because of the enormousness of iTunes, and the feeling that at any moment it could leap into the same sort of game, the reason that smaller music sites are consolidating with other, bigger entities? Are they hoping that the hot-topic of “music discovery” via social media sharing will save their business models?

It actually might be a different threat, though: Spotify. This music sharing site is seeing extraordinary success overseas, and is definitely U.S.-bound as soon as the legal and financial paperwork is all sorted out. When it arrives it could, just maybe, be a threat to some of iTunes’ business, since its key pulling point for the consumer is that to use it you don’t necessarily have to spend a penny. It’ll certainly sew up huge segments of the online streaming music market, which might be what iMeem and the rest are worried about, and why they’re maneuvering at the moment.

But the question of whether Spotify will make a difference at all is a thorny one. The times they are a-changing in the online music game: Piracy has taken a very public blow from Pirate Bay’s closure, iTunes is the number one music retailer in the U.S. and big names like Microsoft and Yahoo are trying to secure their grip on corners of the legal MP3 market. Maybe all this high-level shenanigans means there’s not much room for the little guy with a different business plan–like iMeem–or even the medium-sized guy like Spotify.

[Via AllThingsD, CNET]

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