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Google, Fresh Out Of the Video Business Sorta Enters Music Business

August 13, 2007 by in Entertainment,News with 1 Comment

In Universals long spat with Apple over music sales Universal is attempting to sell music themselves.

Google, Universal, and this company called gBox (sounds suspiciously like a Google subsidiary, doesn’t it?) have teamed up to sell DRM free music subsidized by advertising. Songs are expected to sell for .99 cents a track and there is some convoluted scheme on how the companies will work together and share revenue. My question is why couldn’t Universal sell the music themselves – since they decided to go their own route?

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  • http://infonistacrat.hometownproject.org Jim Smith

    Seems like a no-brainer on Googles part. If they can leverage their existing adsense and adwords infrastructure to subsidize DRM free music, and Universal makes a killing selling DRM-free music, then I think Google has a real chance to seriously injure Apple and iTunes.

    I see it this way…using adwords and adsense advertising, plus taking a really small taste of each track sold, the service pays for itself, with perhaps a small profit for Google. Google then maximizes the profit that Universal makes by giving a large majority of per track revenue to them.

    Smart play here on Google’s part. The future, whether the labels admit it or not, is in DRM-free music. As users become more knowledgeable, they will start demanding it. Google is offering a (quasi)free distribution system to the labels, and proving they can maximize profits for them. Once the other labels see it working, I think Google’s feeling are that the others will follow.

    Look to see Apple’s response….I’m not sure they can respond, as they don’t have the advertising infrastructure Google has.

    Interesting.

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