On Monday, Google Inc. has announced that it has begun offering free and legal downloads of licensed music on its Chinese servers, after the American company reached an agreement with the four largest music producers and distributors in the world – Sony Music, Warner Music, EMI and Universal Music. Google will pay for the songs by sharing some of its advertising revenues with the music companies, one of the first attempts made by the music industry to cash in on the large Chinese market.
In China, the most popular search engine is not the leader of the market, but trails behind giant Baidu.com Inc., which has the most visitors and registered searches per day. The President of Google for greater China, Lee Kai-Fu, said that one of the main reasons why the company lagged behind Baidu was the fact that Google offered no music downloads. “We are offering free, high quality and legal downloads. We were missing one piece – we didn't have music,” Lee stated.
Thus far, approximately 350,000 songs have been made available for download, but plans are to extend that number until it reaches 1.1 million. Artists from both the Chinese and the international scene will be available, and Google is relying on www.Top100.cn to host and distribute the music.
The Chinese site has been reportedly co-founded by Chinese basketball star Yao Ming. “This is the first serious attempt to start [monetizing] the online market in China. I can't overestimate how important this is,” the President of Warner Music Asia Pacific and Asia Chairman of the International Federation of the Phonographic Industry (IFPI), Lachie Rutherford, shared.
The measure has been absolutely necessary, music industry representatives say, simply because some 99 percent of the country's market circulates pirated materials. The remaining one percent is valued at $76 million, a very small sum considering the real worth of the market. With these numbers, the largest country in the world only accounts for about one percent of the worldwide market, a statistic that simply does not reflect the reality.
The main idea behind Google's cooperation with the four companies is to deflect users from downloading or listening to music on pirated websites, and to turn them to the “bright side,” on the official ones. The corporations rely on the fact that their services are much better than any others, and hope that Internet users in China, which number in the vicinity of 300 million, will appreciate this.