• Business Week, Friday, April 4, 2008 11:15 AM

Even as Warner Music, Sony BMG, and Universal Music cut a deal with MySpace for online music downloading yesterday, record labels are looking at other ways to profit online. They are trying to make money off of advertising, promotions, and the sales of items such as concert tickets and T-shirts that they used to leave to others.

Take Imeem. The social-networking site, with about 20 million users, streams music for free on its ad-supported pages. It then shares the advertising revenue with the labels, based on what songs people are listening to. Imeem CEO Dalton Caldwell says the labels' change in attitude just in the past few months has been dramatic.

Other new online business models involve using an artist's music to sell tickets, merchandise, or other ad-supported services. One that has become particularly popular is iLike, an ad-supported music discovery service. Another model the labels are pursuing is all-you-can-eat subscriptions that provide a steady revenue stream.

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