MySpace expanded its presence in the entertainment market on Thursday with the British launch of its music service, as the social networking site seeks to reinvent itself after being eclipsed by rival Facebook.

MySpace Music is already up and running in the United States, and aims to combine music content in the form of songs, videos, artist profiles, playlists and charts with social networking allowing fans to share their discoveries online.

Access to the site is free, but News Corp-owned MySpace aims to make money through advertising and by taking a share of sales of concert tickets and merchandise, reflecting broader diversification in the struggling music business.

Users can also purchase and download songs and albums on Apple's iTunes digital store.

This is indicative of the direction we want to go, said Courtney Holt, president of MySpace Music.

We want to be a social content and media platform and we believe heavily in the socialization of content as core to our future strategy, he told Reuters in London.

It's not about just a passive listening experience. We want you to be active, we want you to go places, we want you to search for music. Music lives in places that require you to work to find it. We know our audience is hungry for discovery.

The website is a joint venture with the four major record companies -- Vivendi's Universal Music Group, Sony Music, Warner Music Group and EMI Music -- and features catalogues from independent labels and unsigned bands.

DECLINING SALES

It is one of a series of collaborations between record labels struggling with falling CD sales and internet sites like MySpace and YouTube which have become key discovery platforms.

In a demonstration of the site, Holt highlighted live concert footage from artists like Eminem and Lady Gaga, interviews with top stars and analytical tools allowing acts to discover the geographical spread of their online fan base.

He envisages the site as a tool for both fans and musicians, who are treated as equals on a level playing field.

Holt declined to discuss whether he planned to introduce a subscription service on MySpace Music, and said he was open to more partnerships in the future like the recent acquisition of music recommendation service iLike.

He would not comment on rumors that MySpace Music was in talks to buy online music business Imeem.

The music business is constantly evolving as new models are being evaluated. Some of this has been built by us, some of these are partners, so I think we are always on the lookout for the right way to evolve this business.

Holt said the consumption of music was changing fast, with fewer people willing buy albums when they can easily sample and buy individual tracks online.

And, with advertising revenue under pressure during the financial downturn, diversification was key not only to pop stars and record labels but also to sites like MySpace Music.

We're a large and live media platform for the social sharing and consumption of music, and we're also bolting on great business opportunities -- ticketing, touring events, merchandise, downloads, Holt said.

(Editing by Paul Casciato)

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