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Universal Music, Sony BMG and Warner Music have taken minority stakes in the MySpace Music, with EMI opting out. The deal was agreed late on Wednesday after Universal Music agreed to settle a 2006 copyright infringement lawsuit against MySpace. A source familiar with the negotiations said MySpace had agreed to pay Universal as much as $100 million to settle.

Chris De Wolfe, chief executive of MySpace, said the launch date of the new service was "fluid" with commercial features being added to the site over the next three to four months. He said MySpace is in talks with more music

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industry partners to offer their services on MySpace Music.

"We're talking to all the big ticketing companies as well as the small ones," De Wolfe told Reuters in an interview. He declined cto omment on EMI's absence.

While the online teen hangout has been wildly popular with both music fans and artists, its main role has been promotional until now.

"It goes from being a promotional vehicle to being a commercial vehicle," MySpace chief operating officer Amit Kapur said on a conference call to announce the venture.

The music industry, concerned about the influence iTunes wields in the digital market, wants to develop MySpace Music into a strong competitor.

"This gives a great new lease of life for the download market," said Thomas Hesse, Sony BMG president of global digital business, in an interview with Reuters.

For MySpace, it was important that the songs not be locked with DRM. Kapur said songs bought on MySpace Music should be "very portable" and work on Apple's iPods and other devices.

There was no word on the future of MySpace's Snocap service, which allows artists to sell music direct from ther MySpace page.