Internet search giant Google Inc. ( GOOG ) is planning to
start a subscription-based music streaming service to challenge
companies such as Spotify Ltd. who offer a similar kind of service
to music lovers.
Launched in October 2008, Spotify Ltd. is a music streaming
service provider with about 20 million users, a quarter of which
are paid users with monthly subscriptions of $4.99-$9.99. Spotify
Ltd. offers music from major record labels such as Sony
Corp. ( SNE
), EMI, Warner Music Group and Universal.
Currently, music lovers can access this service via
Microsoft ( MSFT ) Windows,
Apple Inc.'s ( AAPL ) Mac OS X,
Linux, Telia Digital-tv, iOS, Android, BlackBerry, Windows Mobile,
Windows Phone, S60 (Symbian), webOS, Samsung Smart TV, Squeezebox,
Boxee, Sonos, WD TV, Roku, MeeGo and TiVo.
Google Inc. is negotiating with major record companies to
license their music. This strategy would strengthen its Android OS
as more customers use its paid services.
Previously in Jan 2013, Google launched a paid service for
customers opting to buy songs through the Android Market. This
service from Google was directly targeted at its rival Apple Inc.'s
Google has been improving its music service over the last few
months. Recently, Google Music came out with a new scan and match
feature to better compete with its rivals. The feature allowed a
user's music to be matched in the cloud so that songs could be
played on any authorized device. The service enables users to
upload their music to the cloud from their respective files.
As per a report by market research company, NPD Group, Apple
accounted for 64.0% of U.S. online music sales in the second
quarter of 2012, followed by Amazon at 16.0%. Google notched a mere
5.0% share and other services made up the rest. While Google
remains far behind, the Android OS could be just what it needs to
drive demand for both its free and paid services.
According to the market research company, IDC, Android shipments
touched 136.0 million units in the third quarter of fiscal 2012,
which is 75.0% of overall shipments and was followed by Apple's iOS
that accounted for 15.0%. So Google clearly dominates the mobile OS
Google's rapid expansion into music, television, movies,
consumer items (rice cookers, refrigerators, cameras) is an attempt
to attract more users to the Android eco system. It is also going
all out to break Apple's and others' dominance in online music
In the fourth quarter of fiscal 2012, Google's gross revenue
(including TAC) touched a record $14.4 billion, representing
sequential and year-over-year increases of 2.3% and 36.2%,
respectively. Excluding the $1.5 billion contribution from
Motorola, revenue was up 21.9% from the year-ago quarter.
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