Facebook to start its own music business?

Rafat Ali of PaidContent claims to have dug up more details about the mysterious "iTunes Store rival" that Facebook has allegedly been working on in recent weeks. And he says that sources indicate it's not Apple that should be worried, but rather MySpace, the once-formidable social network that Facebook has been gaining on steadily since the launch of its developer platform in May.

Ali calls the new project an "artist platform," and says we'll be seeing it later this year. "The platform will allows (sic) bands and labels to create artists pages," he wrote, "and allow various widgets to be embedded for music promotion, organizing events, etc." Ali went on to indicate that the widgets in question would still be third-party Facebook platform applications, hence (possibly) quelling the concerns that an in-house Facebook music service would hurt developers' music-related apps.

Allowing the creation of artist pages would be a direct blow to MySpace, which rose to fame partially because it had gained good buzz both as a way for indie bands to increase fan bases and as for music lovers to discover new artists and network with one another.

Facebook is, as expected, not commenting on the matter. A company representative told me in an e-mail earlier on Friday that "we don't comment on new products or business developments/partnerships."

(By Caroline McCarthy, Cnet.)