Google may unveil iTunes rival

ByABC News
November 15, 2011, 8:10 PM

— -- Google on Wednesday is holding a Hollywood event where a splashy music store could rock the industry.

In a wink to mock-documentary This Is Spinal Tap, Google has sent out invites for the music event saying "These Go to Eleven." Eleven was what rock band Spinal Tap's lead guitarist Nigel Tufnel said his amplifier went up to.

Whether Google will loudly go mano-a-mano with Apple's iTunes or launch a rival consumer music experience remains to be seen.

Google is widely expected to unveil a digital download store to feed music to its army of popular Android smartphones. Just a few weeks ago, Android chief Andy Rubin told the crowd at the AsiaD conference in Hong Kong that a service with the support of music labels was "close."

"If they launch this download store, it will provide some capability to move that music back and forth among devices," says Gartner analyst Mike McGuire. "That kind of puts them on an equal footing with what Amazon and Apple have."

What's at stake is a slice of the digital music industry dominated by Apple. Online music sales are forecast to rise 7% in 2011 to $6.3 billion worldwide.

And Google's dominant Android operating system offers the search giant a massive audience to shuttle to a digital music store.

Smartphone sales worldwide rose 42% to 115 million in the third quarter of 2011 compared with a year ago. Android captured 52.5% of the world's smartphone market in the quarter vs. 25.3% a year ago.

Google's music move comes as Apple on Monday unleashed its iTunes Match service. Apple's $24.99 a year service lets people match their music obtained from sources other than iTunes to music in the iTunes Store and put a copy in iCloud.

Consumers can then stream or store their music on any device from Apple's iCloud. Apple last month unfurled its iCloud service to allow people to access iTunes libraries from the remote servers for easier access from multiple devices without connecting directly to computers.

The lack of a music store has dogged Google for some time. The company has reportedly struggled to make the necessary deals with music labels to match the offers of Apple and Amazon.

McGuire says an agreement with music label EMI, already in place, would make sense for Google to launch its music service. But it still needs deals with Vivendi Universal Music Group, Sony and Warner to match the likes of Apple, he says.

A deal with Vivendi Universal is near, according to a Bloomberg report citing unnamed sources, but the latter two music labels haven't come to terms over pricing and piracy in order to strike deals.

Google declined to comment on the music launch.