Google Starts Free Music-Search Service in ChinaAfter months of negotiations with music companies, Google Inc. has launched a free music-search service in China.
Internet users in China can search for songs by singer, song or album title on Google's search page and then download licensed music files for free.
The service will be supported by advertising revenue, which will be split between Google, the music companies and a Chinese music company called Top100.cn, Google announced Tuesday.
If successful, the new search service could provide a way to legally monetize digital music in China, where piracy has crippled the industry, for global music labels including Vivendi SA's Universal Music and EMI Group Ltd., which have artists who are popular in China. Dozens of other foreign and domestic record labels stand to gain from the launch, as well.
Rampant piracy has long eroded profits in China for these companies; industry analysts have estimated that as many as 90% of Internet users in China -- which now has the world's largest population of Internet users -- download unlicensed music online everyday via search-engine services that provide links to unlicensed music downloads.
According to the International Federation of the Phonographic Industry, a music-industry association, the industry loses hundreds of millions of dollars a year because of piracy.
Google didn't specify in its announcement which of the global labels have officially signed on. But the move could also set a precedent for the music industry world-wide, which is suffering from piracy to a lesser degree than in China.
Paid download services like Apple Inc.'s iTunes Store have grown rapidly, but not quickly enough to offset declines in CD sales, which still account for a significant chunk of recorded-music sales.
Under the experimental business model, the companies would provide high-quality recordings of licensed music for free, which is unprecedented in China.
The search would also provide information about artists and albums from Top100.cn's database for free. Watermarking technology would be used to track downloads for meaningful statistics for use in selling advertising.
Internet users outside of China won't have access to the service, which will be limited to China.
The music search could also give Google a significant boost in its struggle to gain market share in China, where its chief rival, Baidu.com Inc., has 64.6%, compared with Google's 26.1% as of the second quarter, according to technology-consulting firm Analysys International. Baidu, though not the only search engine in China to offer music searches and top-song charts that link to unlicensed music, has often been singled out by music-industry organizations because of its lead in the search market, which many credit to products like its music search.
By: Loretta Chao
Wall Street Journal; August 6, 2008
