Google Shies Away from Digital Music Sales

mytrip writes to tell us that Google has announced that they will not be getting in on the digital music sales market anytime soon. Analysts have been predicting the response of a "GTunes" service for months but Chris Sacca, head of business development at Google, dispelled those rumors in a recent address at the annual National Association of Recording Merchandisers conference in Florida. Sacca emphasized the need for "ecosystem development" and partnerships within the industry stating that they were the "big opportunity" in the digital music business.

Comments

No wonder Google doesn't want in.

[telbij]

Digital music is a rough market to be in. The only ones making any money are Apple, and that's from iPods. If the music industry had any concept of developing a new market instead of sucking it dry for the last penny maybe you'd see more companies anxious to get involved. The current business model of suing file traders and restrictive DRM is probably just driving away customers.

Legitimate digital music is really a step backwards. With vinyl, cassettes and CDs there was a certain standard that meant if you bought music you could use it pretty much anywhere. The equivalent standard for digital music is seen as too easy to copy, so they've insisted on DRM. But the real problem is not that MP3s are easy to copy per se, but that computers have changed the rules of the game. The music industry needs to shift their focus to developing a better product, instead of crippling everything and then getting mad when people don't buy in.

Re:No wonder Google doesn't want in.

[Reaperducer]

You are confusing two separate issues.

The fact remains (and this is something that many internet bitcasters can't wrap their brains around) that the average radio station pays millions of dollars each year to play music. Even if you're a crappy three kilowatt FM in some medium market, your licensing fee is going to run about a million dollars a year (Could have changed, it's been a few years since I was involved in this).

People on the internet like to pretend that radio stations get their music for free. Yes, the record companies send them free CDs, but the radio stations still have to pay for playing them on the air. And in many cases, even small stations don't rely on free CDs from the record companies any more. They subscribe to libraries of what are essentially mix CDs full of music tailored to their audience. That's another service they pay for.

I got out of radio several years ago, so I can only imagine what internet delivery of playlists has done to all of this. But one thing I'm sure of -- radio stations aren't playing music for free.

The stupid portal idea

[chriss]

Several years ago everybody was going portal. Every search engine added shopping, communities, finance tips, travel, free mail account and tried to lure users into spending as much time as possible on their site as possible to get their cash and more cash from advertisers.

Then came Google with a simple interface and did one thing: search. And basically everything Google released since then was build around search. Even the videos. But music is very hierarchically organized: Artist - Album - Track. You seldom have to search for something, maybe you'll use Google to search for the lyrics if you cannot remember the name of the track.

Now everybody predicting that Google will go into music just falls into the portal trap. Hey, they did search, they have news, they do mail, so they must aim to become a portal, hence they will try to do everything and so they must want to do music.

Think: Google = search. If the product does not fit, there is no way to make money from it for Google and they won't do it (there will always be exceptions, but that is the general rule so far).

Re:The stupid portal idea

[generic-man]

Google abandoned the "Google = search" idea long ago. Since Google makes 99% of its revenue from advertising, they've been diversifying the way they can serve you ads. How is a beta Jabber server "search"? How is a JavaScript map client "search"? (Sure you can "search" for businesses, but the results are pretty unreliable.) How is a JavaScript spreadsheet program "search"?

Google doesn't sell content

[Null Nihils]

I'm surprised anyone would think Google would want to be a music store. It doesn't really fit their methods and style. Google is not a retailer, they do not take content from a commercial third-party and distribute it, with markup, to consumers. This is nothing like how they currently make their billions.

I have no doubt the minds at Google have thought of how to use music content, but I suspect one of the reasons they aren't jumping in right away is because, to put it lightly, the RIAA folks are not pleasant people to share a market with.

In my estimation, if Google were to focus on music content, it might be something like Google Video, only taken to the next level somehow; Perhaps it would be an advanced form of Internet radio, where each user gets a personalized stream of the music they like, and Google uses their context and marketing technology to make a tidy profit off of the millions of attentive ears. And of course, the music content they included would have to be free...

First to predict

[ronkronk]

that a half-baked story predicting that Google will enter the wireless provider market in order to support the foray into their online music business. GMusic store will allow you search 7 billion recordings using lyrics, instruments used, and sound patterns.

Also, in 3 to 6 months Microsoft will apologize to their employees, customers, and vendors for falling so far behind as an MVNP and music distributor. But Balmer will commit to catching Apple, Google, and AllOfMp3.com within the next 3 to 4 quarters. It's Microsoft's top priority next to releasing Longhorn, WinFS, security, DRM, the next version of SQL Server, Exchange 2007,.NET,.ORG, ethic, combinatorial global business synergies and leverage points and Windows on the Power PC.

Lastly, Apple frustrated with the iPOD to car stereo interfaces and refusal by many automobile manufacture to integrate the iPOD directly into their automobiles will purchase an Korean automobile company and begin manufacturing iCars. These cars will include new design innovations including ergonomic steering wheels and see through dash panels. Initially the automobiles will run on Honda gasoline engines, but Jobs will announce in the first 4 years of production that the iCar (and soon to be released iSUV) will switch to Toyota engines that can run on electricity, gasoline, jet-fuel, whiskey, and the sweat of some breeds of Tibetan mountain goats.

Step aside Dvorak I have spoken.

Blame the RIAA

[ATMD]

Google know they can't make it good (Read: no DRM), so they aren't doing it at all.

Once the music industry finally pulls its finger out, we'll see our gTunes (beta) within a few months.

Oppurtunity

[remembertomorrow]

If I were (one of the guys) in charge of Google, right about now I would be looking to create GMusic, a Google record label.

Offer fair prices on albums, and offer artists the majority of the profit (aside from what is required for operating expenses).

With all the piracy/lawsuits/RIAA crap that has been happening lately, I'm pretty sure at least a few major bands would jump at the chance to be part of a less evil label, and consumers would be happier/more inclined to buy from a label that actually supports their artists.

Very suspicious...

[TheRon6]

If they're not looking into getting into the digital music market, what was the head of business development doing at the annual National Association of Recording Merchandisers conference? Sounds kinda shifty to me. :-P

Google doesn't really do consumer

[91degrees]

They're really about providing free advertising funded services. Search is free. gmail is free. Groups are free. Presumably they don't want to deal with the inconvenience of paying consumer customers, who after paying a few dollars want everything. Business customers pay a lot more and are no more demanding.