Google Has Begun Testing Google Music, But Labels Still Have Not Agreed To Additonal Use

image from blogoscoped.com Google has begun testing its cloud music services internally, according to a report by CNet's Greg Sandoval.  It's the same music system that we reported hackers had stumbled across a couple of weeks ago.  But Google's tests don't mean that launch is imminent.  According to our sources, though labels and publishers hope Google will enter the market and compete with iTunes, so far they've been unwilling to offer reasonable terms to license the new service. Here's the problem:

Unlike current talks between Apple and rightsholders over storing music bought on iTunes in the cloud and allowing play on a variety of devices, Google wants to store music purchased anywhere. Since they've got the purchase data, it's easy for Apple to know the tracks in their locker were bought from them.  But how can Google verify where tracks in their locker were bought or if they we obtained legally?

Many rightsholders also view playing music from the cloud as an "additional use" and believe that they deserve additional compensation for each play.  Both Google and Apple are, according to sources, willing to share some portion of their monthly locker fee with rightsholders. But just how much and how payments might be calculated and divided is still the subject of heated negotiations.


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