MySpace to acquire iLike?

News Corp.-owned MySpace is "close to acquiring" social music service iLike, according to TechCrunch.

The price tag is rumored to be in the neighborhood of $20 million. Representatives from iLike were not immediately available for comment.

The report comes within days of iLike launching a music download store--a development first reported by CNET News--with MP3s available from all four major record labels.

The deal, if confirmed as accurate, highlights the often complicated connections in digital media's elite ranks.

iLike, for example, rose to fame through its close ties to Facebook. The iLike application, since re-branded to simply Music, was one of the first big applications to launch on Facebook's platform at its debut. Its ad-supported streaming music service has become one of the most prominent in a packed field--it now has about 50 million users and just launched a suite of iPhone apps. But the streaming music niche has proven difficult to monetize and has left some players in the space reportedly hunting for an exit.

MySpace, meanwhile, has seen stagnant growth as the once-far-smaller Facebook has rapidly overtaken it in the social-networking race, thanks in part to the proliferation of third-party apps like iLike on Facebook's groundbreaking developer platform. As part of an executive restructuring earlier this year, MySpace installed former Facebook chief operating officer Owen Van Natta as its CEO, replacing co-founder Chris DeWolfe.

Attempting to refocus and return to its roots as a hub for music and pop culture, MySpace launched its own streaming music service, called MySpace Music, and hired MTV veteran Courtney Holt to run the division. MySpace Music, a joint venture with the record labels, does not operate its own download store but instead directs users to Amazon MP3 downloads through affiliate links. But MySpace Music hasn't received thoroughly positive reviews from the record labels hoping to profit from it.

Disclosure: CNET News is part of CBS Interactive, which also publishes Last.fm, a competitor to iLike.

Updated at 7:38 a.m. PDT with additional details and background.

[blastjacket]

This is a failure and MySpace is throwing their buddies at iLike a lifeline to save face. I question the 50 million users. How many of them are actually active? What good does this service do? If not for the pedigree of the Founders (meaning in the club) this would have just died as they ran out of money.