How Google is Taking on iTunes in the Cloud
The race is on to give users access to their entire music collections online. Apple's (APPL) shutdown of Lala this month was a precursor to a cloud-based iTunes. Then last week Google (GOOG) announced it will launch its own online music service. Details about both projects remain sketchy, because both companies are competing behind closed doors to get things squared away with the major labels.
Google announced at its I/O conference last Thursday that it had acquired Simplify Media, and would be using that software to let users stream their music collections from home to any Android powered device. The company also showed off a new music section on the Android marketplace that would let users purchase a song and download it automatically onto their computer and phone. But the exact release date of these functions is unclear.
As it turns out, Apple has already approached the major labels about opening up this kind of "digital locker" for iTunes users to store their music. But according to the WSJ, the talks were a "swing and a miss." The labels don't like the idea of users paying a single fee for a song they can stream anywhere on multiple devices.
This seems totally absurd, considering that users can already pay once for a song, then port it to as many devices as they like. But inane behavior that frustrates paying customers has been the record industry's strategy for decade now, along with cratering revenues. Google and Apple would like to avoid any legal wrangling. The record industry has already filed lawsuits against MP3.com and MP3Tunes.com, sites which let users upload and access their music from the cloud.
Interestingly, Google also used its I/O conference to debut an independent firm, MSPOT, which just launched a free 2 gigabyte music locker that lets users upload any MP3. This seems like a clever strategy. Google is giving big exposure to a company that is about to start working the legal gray area that the bigger firms would like to expand into. If MSPOT flops, or incurs legal heat, Google stays out of the line of fire. But if MSPOT really catches on, Google can use it as leverage to coax the record labels to sign up with the Android cloud.
