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Why Google has everything it needs to disrupt the music business

Google Holiday Logo 250th Birthday of Wolfgang Amadeus Mozart - January 27 2006
Since the record music can be played everywhere without actually having to transfer the musician. This changed how we consumed music. A complete industry was build around transferable music, the ‘record industry’.

The web is not just a network connecting computers anymore. The web is a virtual layer of information accessible almost everywhere, anytime via broadband, UMTS, wifi and cable. The availability of this network and its role as real-time meta information network will only grow.

The web is already changing how we consume music. The availability is like radio, but the tunes you can listen to are personal. Technically you could listen to any song you like at any time you like from any place you like.

The only thing we need is a library of music and a business model. This is where Google comes in. When a website grows as exponential as Google did you need a serious hardware model to support the demand. You need servers and broadband connections around the globe. The hardware structure and back-end Google has (in combination with YouTube) is probably one of the most advanced in the world. The amount of data they send up and down the lines of our network connections makes them a very import player in data exchange.

Amazon build a new model on top of their original business. With S3 and Ec2 Amazon started to sell hosting and computing, a smart move since they already developed an enormous infrastructure for amazon.com. This infrastructure equals a value that makes it a serious hosting competitor in price and service.

Why Google for music? Google has experience with indexing large amounts of information and they know how to retrieve meaning from information. Google has experience with web-players, mobile platforms, plug-ins, widgets, trust and a payment model. They sit on all the required knowledge. All they have to do is mixing the components together.

The future of music won’t be about files or discs, it will be about listening your favorites, your friends favorites or songs recommended by websites and smart collectives. Music still has value, it doesn’t have to be free. I think a subscription model could work. You pay $20,- to $50,- a month to a company (Google in this example) and you are allowed to listen any music you like. With this money Google pays artists based on listened percentages. It’s all about micro payments and since everyone is an artist nowadays, everyone should be able to upload its files to the Google Music directory.

On top of this Google could include its adwords system related to what you are listening. A system that has a proven effect in giving advertising power to the niche.

There is already a Google Music player. Just find someone to connect the dots.

8 replies on “Why Google has everything it needs to disrupt the music business”

There’s a big chance google will do what you suggest. But I also read that some mayor recordcompanies are working together with last.fm to do almost the same thing. Either way it seems like the next step for sure to have only access to music instead of storing it. And a custom made book with all the album art for those who like :)

I think google is going to stick closer to their core business, search, than they have with for instance the acquisition of youtube. I think they realize that advertising on the web works best (or even at all) when people are searching. I am hardly the measure of all things, but I don’t notice ads on sites, unless they move and blink a lot, or block the access to the actual content, (a reason for me not to visit the site in question) *or* when I am actually searching for a place to buy something.

That’s why google’s adds on google.com work, since they happen to have a great search engine, and google ads via adsense on third party sites work to a much lesser degree. (Also the automatic selection of the actual ads is comically inane, most of the time.) People coming to your site for the content are not going to click random ads, the only model that works is targeted advertising/advertorials specific to your site. Anything else is either invisible, or annoying. The reason annoying works in traditional media, to some extent, is that there is a single stream you can interrupt with ads. On the web you can too, but people won’t expect it, and hate it.

Will google start storing mp3s or acquire some streaming service? I don’t think so. Once the major labels accept that their business model has changed, and stop suing everyone that is trying to show them the way to a new model, google might put some UI on the mp3s they already index, and combine that with ads targeting music fans, and probably overtake sites already doing this, like hypemachine, simply because they have the resources to index more and faster.

Google is all about indexing and linking to, not storing and providing actual content, and I think they will stick to it more and more. On the other hand, they might buy a music service just for the heck of it, they seem to be in perpetual competition with yahoo to own one of each ‘next big thing’.

Interesting news

Adoption of Amazon Elastic Compute Cloud (EC2) and Amazon Simple Storage Service (S3) continues to grow. As an indicator of adoption, bandwidth utilized by these services in fourth quarter 2007 was even greater than bandwidth utilized in the same period by all of Amazon.com’s global websites combined.

Amazon Web Services: Bigger than Amazon

@eric I think you’re right that Google is best in retrieving information. But, they do store information. Documents in Google Docs, e-mail with Gmail, pages with page creator, photos with Picasa and video on Google video / Youtube.

Google has to grow one way or another. Like Yahoo Google has shareholders and shareholders love the ‘next big thing’.

I don’t know if Google will ever go into music, but I like what happens when you create successful websites or services. You get automatically chances for new spinoffs. I think this also happens to manufacturers of goods.

On Techcrunch there is an overview of Google products and their growth rate.

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