The quest for a sustainable ad-supported music model hinges upon the ability to generate enough revenue to compensate rights holders. A frequent criticism of current models is the unrealistic economics. Paying labels a penny per stream, it is often argued, merits a $10 CPM rate while ad-supported services require something like $1 CPM.

Short of labels and publishers cutting their rates, the obvious solution is to seek out a different business model. Expenses too high? Bring in more revenue. Ad rates too low? Do something that will allow you to raise them.

It appears MySpace hopes to give advertisers enough return on investment to merit a rate hike. Jeff Berman, president of sales and marketing at MySpace, told New Media Age that CPMs will increase upon the launch of MySpace Music. The article says speculation in the US is that rates could increase up to 300%. Ads are currently £2 ($3.70) in the UK.

Advertising executives quoted in the article understood the need for higher rates -- to pay for the unlimited streaming -- but were cautious in believing the return on investment will be adequate after initial tests. Said one executive, "MySpace would find it very hard to justify an increase in CPMs in the social media space as it's so over-supplied."

In theory, the service's free music streams could be used as a loss leader. Not a pure ad-supported service, MySpace will sell downloads, ringtones, concert tickets and other items. But subsisting on affiliate fees should not be the venture's goal.