Google Music has been around for a few months now, and according to a CNET exclusive, Google told music labels that customer adoption and revenue are below what they expected. Since the service is still pretty new, no one at Google is too worried. They still haven’t marketed Google Music as aggressively as they could, and Google told the record companies that certain issues are still being worked on. But that’s little comfort for some folks in the music industry, sources said.
Potential
When Google Music launched in November, there was a potential customer base of over 200 million users of Android devices. That’s a big enough audience to make Google’s answer to iTunes a music powerhouse. Converting just 10% of the user base would equate to 20 million customers. The potential is there, but is Google’s strategy too dated?
Competition
The Google Music service sells music from several indie labels and all major record companies except for Warner Music Group. Users can then download or stream the music to their devices or desktops. Users can also upload up to 20,000 songs to Google’s servers and make them available for streaming as well.
This comes at a time when services like Spotify and Rhapsody are taking off, offering access to an already existing huge collection of music for a monthly fee. No uploading needed, and no need to buy individual songs or albums. This all-you-can-eat buffet-style offering seems to fit many people’s lifestyles.
Other upcoming music services also threaten to fragment the customer base, including Microsoft’s rumored Xbox and Windows Phone music store. Carriers are also in the music game by offering their own music download services, such as Sprint’s Music Plus and Verizon’s V Cast.
Let’s not forget the free services available, such as Pandora and Slacker Radio. These services act more like streaming radio stations, where the user doesn’t select specific songs or albums. They just tell the service what they like, and the service serves up music accordingly.
Hardware?
Sources are also saying that Google is expecting the service to get a boost once their hardware strategy rolls out. Could this be Google’s wireless entertainment system we reported on earlier? This rumor talks about a system that streams music wirelessly throughout your home, presumably using the Google Music service.
Future
Will Google Music ultimately fail? Who knows. It’s too early to tell. With all the different options people have to get and listen to music, it’s hard to say if one will end up “winning” or if there is enough room for several big players. I believe each type of music service (cloud storage, subscription, and radio) will be around for a while since they each cover a different type of user. But will Google Music go the way of Android, or Google Wave? Let’s hope it’s the former.
Do you use Google Music? What are your thoughts? Sound off in the comments!
source: cnet