News.blog: Facebook to try music streaming?

Facebook may be getting closer to launching a music service that competes with Apple's iTunes, the Financial Times reported on Wednesday.

Sources told the publication that Facebook has been approaching major record labels about licensing deals so that it can sell music through its Web site.

It's a long-standing rumour that has once again floated to the surface of social-media chatter.

Music sales would provide Facebook with an alternative revenue stream -- the site currently relies on advertising, which many have said is precarious for a social network -- and would additionally help it compete with bigger rival MySpace.com, which has a service called MySpace Music in the works and has the big-media backing of parent company News Corp to give it an extra push in the entertainment industry. For the labels, selling music on already-popular social-networking sites is a way to tap into a youth market that has been abandoning CDs.

But it wouldn't necessarily be a good thing for companies that have built music-related applications on Facebook's developer platform. Some of them, like iLike, Imeem and Last.fm, have ad-supported streaming or paid downloads already tied into those developer applications and it's unclear what would happen if Facebook creates an in-house competitor.

The Financial Times article suggests that like MySpace Music, the shadowy Facebook music initiative would likely offer both streaming music and downloads. "While details remain vague, record executives said that they expected a service would offer consumers free streams of music, supported by advertising, as well as the ability to pay for downloads in MP3 format, which can be played on any device," the Financial Times article stated.

But this all might take awhile. "Facebook Music" is something that has been talked about for months and so far has borne no fruit. Back in October, AllFacebook blogger Nick O'Neill said that he was familiar with someone interviewing for the position as head of Facebook's "music division" and that the social network was already in negotiations with record labels.