MySpace may follow its acquisition of iLike with streaming music service Imeem to its music roster. TechCrunch, citing multiple unidentified sources, reports that the companies are in late-stage negotiations, price unknown. Whatever it is, it wouldn’t be the exit Imeem Cofounder and CEO Dalton Caldwell and investors hoped for when it relaunched as a social music service in 2005 with an innovative approach to sharing music online, when it made licensing deals for ad-supported streaming with all the majors in 2007, or, in 2008, when it acquired Shawn Fanning’s Snocap and its technology for digital rights and content management. Update: Rafat adds: We have confirmed the deal talks, though no clear what stage they are in.
MySpace, which spent a year or so developing MySpace Music on its own, wants more music heft. Acquiring iLike made it part of the new Google (NSDQ: GOOG) Music Search and brought in new talent. Adding Imeem would bring more of that social element and an established user base; it had 15 million uniques in September, according to comScore (NSDQ: SCOR) (via TC). TC also repeats a recent report that MySpacer Music will have to go subscription to manage costs. I’ve been told MySpace doesn’t plan to end free ad-supported streaming although I wouldn’t be surprised to see a premium/subscription offering; last week in Monaco, News Corp (NYSE: NWS). Chief Digital Officer Jon Miller told Rafat he believes in the “freemium” model as a concept, also saying that costs of payments to the labels make a paid model worth considering.
Imeem hasn’t had an easy time of it, spending much of the last year looking for ways to survive after a sales effort in late 2008. Warner Music Group (NYSE: WMG) wrote off its $15 million investment in the company in May, as well as expectations that it would receive $4 million fro the free streaming service. That same month, Imeem said it raised $2.4 million of a $6.5 million new round. Then, in June, Warner helped Imeem restructure, taking a larger stake in the company in exchange for lower licensing fees. WMG is also a partner in MySpace Music and execs were vocal early on about concerns the venture wasn’t delivering results fast enough.