With Google Play’s music store about to launch in Europe – complete with a WMG deal and scan-and-match locker features – the tech giant could be about to take a big step forward in its relations with music rightsholders. But with the BPI on the warpath again over piracy, are Google’s search engine policies still holding it back?
We’ve been covering the ups and downs of Google’s music industry relations for several years now: one part of the company negotiating licences for its video and music offerings, and another tackling criticism from rightsholders about the way Google’s search engine points people to illegal downloads of copyrighted music.
November should be a very positive month for Google’s music ambitions. On 13th November, its Google Play digital store will add à la carte music downloads in the UK, France, Germany, Italy and Spain – all following its launch in the US a year ago. What’s more, Google has inked a licensing deal with Warner Music Group to finally bag itself a full set of major labels, and has succeeded in negotiating the necessary licences to offer scan-and-match functionality for its cloud music locker, ensuring users don’t have to manually upload their entire collection. It’s a big challenge to rivals Apple and Amazon, since Google’s cloud music service is free with up to 20,000 songs worth of storage, whereas both those companies charge.
What’s more, Google’s service is tied to its Android operating system for smartphones and tablets, which is growing startlingly around the world thanks to a succession of impressive devices – including some sold by Google itself under its Nexus brand. Sexy devices, a popular operating system, and an innovative cloud music service with its own downloads store: in theory, that strong rival to Apple that music rightsholders have been yearning for has finally arrived.
“We’re really proud to have all of the major labels and rightsholders engaged. It’s a learning process for them,” Sami Valkonen tells Music Ally. He is currently head of international music licensing at Google, having previously been a key figure in the team that got Nokia’s ambitious Comes With Music service licensed for a global rollout back in 2008.
“I’ve stated publicly before that I’ve seen the problem in the music industry: they tend to operate from an element of fear, rather than really seeking to capture an opportunity. In this case, I tip my hat: they understand and are willing to work with us, and to move forward with this,” says Valkonen.
One notable point about Google Music is its concentration on ownership, much like rival services from Apple and Amazon. It’s about moving the songs you already own into Google’s cloud and buying new songs from its store. At a time when Spotify and Deezer are growing fast, when Microsoft and Sony are bundling cloud storage and streaming access to a wider catalogue of music, and when Apple is preparing to launch its own personal radio service, what’s behind Google’s strategy?
“Ownership is still about 80% of the market, and it’s by far the predominant model to date,” says Valkonen. “We believe that there will always be a role for ownership: it’s always going to be a significant element of the consumer base.” He also criticises the suggestion that by definition, streaming subscription services are more advanced than à la carte stores. Rather than the inevitable march of technology, Valkonen puts the case for it being more of a consumer psychology issue.
“People have different tastes: some people don’t want to pay monthly, and some people don’t mind,” he says. “This isn’t that subscription services are somehow more technologically advanced than the ownership model.” (Of course, Google has YouTube – the world’s largest streaming music service by some distance.)
But while Valkonen’s defence of the ownership model feels like more than just a marketing line, he leaves the door open to additional access-based components in the future. “Google always looks to innovate and evolve. We’re not closing the door on anything.”
If there are doors being slammed right now, they’re likely in the headquarters of British music industry body the BPI, which returned to some familiar themes this week in its attack on Google’s search-engine strategy. The latest spark is Google’s promise in August that it would add a new signal to its search algorithm: the number of valid copyright notices it receives from any given site.
“Sites with high numbers of removal notices may appear lower in our results,” promised Google’s SVP of engineering Amit Singhal at the time. The BPI – along with bodies from the book publishing and software industries – isn’t happy with the progress made since then.
“Google said it would stop putting the worst pirate sites at the top of search results. Google’s transparency report shows they know clearly which are the most infringing domains,” said chief executive Geoff Taylor this week. “Yet three months into the much-vaunted algorithm change, many of these illegal sites are still dominating search results for music downloads.”
The British government’s Department for Culture, Media & Sport is hardly rattling its sabres in support of rightsholders, promising merely to “consider our options” following a review of Google’s promise and subsequent action. The prospect of more months of debate over whether the government will or will not legislate on the matter is enough to make us want to build one of The Pirate Bay’s mooted robo-balloons and sail off into the stratosphere. What’s more important here is the relationship. Or rather, the impact that the piracy arguments with one part of Google – its search team – are having on the potential of the happier working partnerships with the Google Play team.
In late 2012, Android is a phenomenon. Google has activated more than 500m Android smartphones and tablets, with 1.3m more following every day, putting it on course for 1bn activations sometime in 2013. Analyst firm IDC estimates that Android accounted for 75% of all smartphones that shipped in the third quarter of this year, while also hailing the growing momentum in the Android tablet business, where Android manufacturers Samsung, Amazon and Asus accounted for 36% of all tablet shipments in Q3 versus 50.4% for Apple’s iPad.
Google Play music and Android are inseparable: the rise of the latter has the potential to rapidly drive the growth of the former, which is pitched squarely as a mobile music service. “One of the key things with Google Play music is that it makes purchasing music on mobile extremely easy,” says Valkonen.
“The proportion of our sales in the US is very heavily mobile-slanted, which is another key piece of data that really shows mobile is where music lives.” Pandora, Apple, Deezer, 7digital… Many digital music firms will make the same statement, which is why it’s so important that the (important) debate around search results and piracy doesn’t hamper the efforts to make Google Play a viable competitor to iTunes.
“With the launch of music in Google Play, now is the time to build a genuine partnership and for Google to show the world that it loves music,” said Geoff Taylor, during his criticism of the company this week.
If Google does love music – but also if the music world thinks a bit more about the reasons it might love Google – there is rich potential. Not least because of the company’s efforts to bring people’s usage of its various services into unified accounts.
“With the cloud library, we obviously have an ability to analyse exactly what you have, what you listen to, and when you’re logged on to Google, we can take inferences from your other activity, on YouTube or wherever,” says Valkonen. “We can really provide every single user with personalised recommendations, and in my own experience, those things are effective. That’s the type of stuff we do pretty well! When recommendations are relevant, you actually pay attention to them.”
It’s not surprising that Google continues to face criticism when its main site seems to be recommending piracy sites to searchers. But with continued goodwill on both sides, the legitimate music recommendations it can start making to hundreds of millions of Android users could have a significant impact on the music industry’s digital growth.