This past week has revealed MySpace to be in quite a slump. First, there has been speculation that MySpace is considering moving to a paid model. According to an interview by paidContent with News Corp. digital chief Jon Miller there is interest in the “freemium” music model. TechCrunch further investigated and is sure free streaming will becoming restricted, “‘They are spending $20 million/month on streaming royalties, and that just isn’t sustainable,’ said one source with knowledge of MySpace’s relationships with the labels. Other sources have said that MySpace’s royalty payments are much lower, but don’t deny that the service is a cash hole”.

This comes as an interesting time because there has also been news that Spotify is delaying its US launch, which leaves the field for premium music service fair game for now. However, will users pay for a site that’s always been free? Business Week summed it up best that “MySpace would have to overtake more nimble competitors to draw users to a paid music service while overcoming the perception that it’s a messy-but-free one”. It seems the only way MySpace Music is going to stand a chance is if with the introduction of paid subscriptions it offers premium content. This may be possible as the majors own stake in the service, but providing exclusives could still come at a cost. Otherwise, users will go elsewhere for free music; god knows how many are out there today.

Also there have been rumblings recently from other companies hoping to get in on the “freemium” action. Skype and KaZaA’s Rdio service has been securely kept under wraps until screenshots leaked last week on ReadWriteWeb. The article stated, “According to Rdio’s Get Satisfaction page the service will offer a desktop client, a Blackberry application, an iPhone app and a web interface. Users can control their community dashboard, listen to playlists, find other music in heavy rotation and stream collections”. There isn’t much else yet on the programme but there is only one of the four majors signed up so far so we might not hear from them for a while.

Music blog network MOG has also been revealing teaser videos recently for their anticipated All Access music service which for $5/month appears to revolve around the user experience and offers music discovery through intricate playlist searching. This one appears to be more viable as a press release last month indicated it had all four majors signed on and it’s currently in private beta.

There is also the issue of its relationship with Google. Although the details of the music search deal are unknown, it appears that MySpace didn’t get the best end considering Google is introducing the mainstream to Lala…how do MySpace think they’re going to compete? It’s not to say the music search will eradicate the need for MySpace, as search pages list an artist’s MySpace page as a relevant site…but why would they click an extra link to hear the same music? MySpace has always been a great way for artists to get their own personalized platform and connect with fans, but that may be what it only ends up being.

With the incoming competition, along with a decrease in ad payments from Google starting in the next eight months or so it would seem that MySpace is being squeezed out in a sense. It doesn’t help that Facebook has also started to give MySpace’s iLike programme restrictions on how it can communicate with its users. While Facebook claims it’s for to “fight app spam”, TechCrunch suggests it’s personal, “Even though iLike is the top music app on Facebook, with 12 million active monthly users, the two companies have been on the outs ever since iLike was picked up for a song by arch-rival MySpace. The recent deal with Google Music to show iLike/MySpace Music results added insult to injury”.

With users flocking to rival social networking sites, News Corp and labels breathing down its neck for profits, and its allies undermining its once-powerful influence, MySpace really does seem to be wedged between a rock and a hard place. It’ll be interesting to see if there is a premium subscription service what it’ll bring to the table, but we shouldn’t get our hopes up for anything spectacular.

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