Cnet reports that Myspace is looking to invade the turf of Spiralfrog, Imeem and Qtrax.
The News.corp owned web property is apparently holding discussions with the four major music labels to start a free-to-consumer music service akin of the traditional radio model and mimicking Hulu.com which offers the same service but for video.
Paidcontent also reported that the music companies would be offered a share of a newly created Music startup, spawned by Myspace and which would be offered to the hundreds of millions of Myspace users.
Most sources mentioned by Cnet's article point to a streaming service, although it would make sense to have either ad supported or paid for downloads, given that this can be done without much pain.
It is true that Rupert Murdoch's Myspace can afford to lose a little money in order to grab a fair share of the growing online music market.
Facebook and other social networks could also be encouraged to adopt Myspace's strategy in order not to lose out to the biggest social networking website around.
The losers will include radio stations and startups like iMeem or Spiralfrog who may find life extremely precarious when facing several 800-tons Godzillas.