Microsoft is reportedly planning an expansive Xbox music screaming feature similar to iTunes and Spotify.
As reported by Bloomberg, Microsoft is in talks with Universal Music Group, Warner Music Group, Sony, and EMI.
The streaming option would be available on a monthly or annual basis, while saved content would be available via the cloud on various devices, Bloomberg said.
Microsoft announced plans for a new Xbox 360 music service at the E3 conference earlier this month, but released few details about what that service would entail. Bloomberg said the company had not yet secured label deals.
On its Zune website, Microsoft said it will be "using our expertise from Zune to launch a brand-new music service under the Xbox Music brand, [which] will bring you a world-class music library, and great new ways to enjoy, share and discover new music."
Microsoft retired the Zune last year. Xbox Music will be available on Xbox 360, Windows Phones, and Windows 8 powered PCs and tablets, which are expected to debut in the autumn - further insight into the exciting new OS can be found across ITProPortal, including a first-hand report from the TechEd Europe events we attended in Amsterdam earlier this week.
A Microsoft spokeswoman declined to comment on the report.
Rumours of a music service began circulating earlier this year.