Social-networking site, MySpace is in talks with major record companies to create a service that would provide users with free music as it moves to distinguish itself from encroaching competitors such as Facebook.

According to the reports from The Wall Street Journal and CNET on Wednesday, it seems like MySpace could be the latest newcomer in the world of online digital music.

The News Corp's company intends to launch an advertising-supported free music service which can be played on almost all portable devices, including Apple Inc.'s popular iPod. It will also offer paid MP3 downloads.

The labels approached by MySpace include Vivendi SA's Universal Music Group, EMI Group Ltd., Warner Music Group Corp. and Sony BMG Music Entertainment, a joint venture of Sony Corp. and Bertelsmann AG.

However, the paper notes that Universal Music and MySpace are locked in a copyright-infringement lawsuit that would most likely need to be settled before any agreement could be reached on a new service.

Revenue from the service, tentatively dubbed MySpace Music, will be split with the labels.

If the venture gets approved, News Corp would join, Wal-Mart and a group of other competitors who are trying to challenge Apple's dominance of online music through its iTunes store.

MySpace has already launched online video service Hulu, a joint venture between NBC Universal and News Corp., which could serve as an example of how the networking site would implement a music service.

MySpace's new ventures are perhaps part of a larger plan to distinguish itself from faster-growing competitors like Facebook and Linked-In. MySpace is currently the world's largest online social-networking site with over 300 million users worldwide.