MySpace Music Ready To Take A Bite Out Of Apple iTunes' ProfitsMySpace Music Ready To Take A Bite Out Of Apple iTunes' Profits

It wasn't enough for MySpace to hold the top slot as the most popular social networking site on the Internet.

The News Corp. company had to take on the Goliath of the music business.

MySpace announced Thursday that it will sell music for three of the four major recording labels. The company said that those three labels -- Universal, Warner, and Sony BMG -- will receive equity stake in MySpace Music, which will operate as a separate business entity from MySpace.

MySpace co-founder Chris DeWolfe said the new company will provide many features that MySpace users have requested.

MySpace, apparently ready to challenge iTunes, plans to offer music downloads and more. Many musicians already use MySpace for promotions, but the MySpace music service will organize merchandize and concert ticket sales, as well as mobile features.

MySpace would not disclose how much the company will charge for music or how it will share revenue, but it will offer ad-supported free streaming music and video, as well as some DRM-free music online.

The news was announced as Apple confirmed that iTunes had leaped to the top of the heap among music retailers in the United States, according to new statistics from market research firm NPD. Last month, Wal-Mart boasted the title of the largest music retailer in America. ITunes ranked second last year, after exceeding sales at Best Buy and Target, according to NPD.

Apple reports that 50 million customers have purchased more than 4 billion songs in the five years since the company began selling music through iTunes.