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Google May Be Close To Developing iTunes Competitor

Bear Stearns maintained an "outperform" rating on Google and said the Internet search giant may be looking to expand into the MP3 downloading business.

"We believe that Google is in the midst of creating its own iTunes competitor, which we've dubbed 'Google Tunes'," the analyst wrote in a client note issued today. "We think this is a logical step, now that the nascent Google Video product has been introduced."

"We would expect Google to rollout a Beta service within 3 to 6 months. We note that Google has not confirmed our expectations, and that our thinking is based on Mosaic theory," said Peck. "However, we do think this fits with Google's recent moves and its ultimate goal of organizing the world's information."

"Google Tunes" would also give Google another revenue more places to put contextually relevant and keyword ads for related products like MP3 players, concerts, t-shirts, etc. They could also cross-promote Google Tunes with Google Video. Buy a song from a certain artist and get the video OR by the video and get 20% of that artists album.

Another revenue stream might have Google allowing offering a monthly subscriptions of unlimited downloadable content and/or one for those who only want to stream music to their computers. Many services already offer these services. In fact, I'm listening to a playlist of music I created via Rhapsody as I write.

Resoures: http://www.forbes.com/2006/01/26/google-apple-0126markets08.html, http://blog.searchenginewatch.com/blog/060126-233641

posted by What I Write @ Article