Google, Fresh Out Of the Video Business Sorta Enters Music Business
Posted in Entertainment, News by Dan at 9:02 am
This post was published 2 years 7 months 9 days ago which may make its actuality or expire date not be valid anymore. This site is not responsible for any misunderstanding.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?
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.