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It’s MySpace to the rescue!

Several major music companies have recently partnered with the social network to provide ad-supported streams and paid downloads to users. Perfect timing, too. Because according to this study, the industry is projected to lose more than $1 billion in revenue over the next two years. Drastic times indeed call for drastic measures.

Will this move put the final nail in the physical-music coffin? Not quite. CD sales still account for the majority of total music revenue and will continue to dominate despite an overall decline in music purchases. The cooling of consumers’ heels at Best Buy, Circuit City and other suppliers, however, will clear the path for digital and mobile music to grow, the combined revenues of which will account for more than half the industry’s total income by 2011.

Is the digital- and mobile-music gravy train in danger of being derailed by MySpace’s music plan? Seems likely.

But that’s what happens when a billion-dollar industry bites the hands that feed it.