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Google to Shut Down China Music Service.

Google to Shut Down China Music Service - WSJ.com

'BEIJING—Google Inc. said it will shut down its China-only music-download service, in the search giant's latest setback in the fiercely competitive Chinese Internet market.

The Mountain View, Calif., company said Friday it would shut down Google Music Search on Oct. 19, prior to which users can download content.

On a company blog, Google cited the disappointing performance of the service. "The influence of this product turned out to be lower than we expected, and as a result we decided to transfer our resources to other products instead," it said, adding that the move is part of "an ongoing effort across Google to bring greater focus to our portfolio of products."

A spokesman declined to elaborate. Google hasn't disclosed details of the service's performance.

Google launched the service with great fanfare in 2009 in an event that included Taiwanese pop star Jolin Tsai. At the time, Western media companies considered China problematic because of the easy accessibility of pirated movies, music and television shows.

Google Music offered Chinese consumers free, licensed digital downloads in a bet that consumers would prefer high-quality legal versions of their favorite songs over poor-quality pirated copies. Google hoped the service would give it a boost in its competition with China's homegrown search giant Baidu Inc., which record companies had accused of making pirated music easy to find.

Google reached agreements with labels including Warner Music Group Corp. and EMI Group Ltd. to offer songs. Google offered the labels a share of the revenue from banner advertising that appeared when Chinese Internet users searched for songs.

But the company's China strategy shifted sharply a year later when it said it would stop censoring Web searches to meet China law and moved its search servers to the Chinese territory of Hong Kong, which operates under its own laws. The move made many of Google's services more cumbersome for Chinese consumers to reach and led to service glitches resulting from China's Web censoring and monitoring systems. Google Music isn't available outside China.

The landscape in China has also shifted, as major Internet companies clean up the pirated content on their sites and look to reach licensing deals with media companies to provide exclusive, high-quality content. Last year, Baidu reached its own licensing deal with music labels and began offering free downloads on a service called Ting.

Baidu now controls roughly 80% of China's Internet search market, according to research firm Analysys International, while Google has about 15% of the market. At its height in 2009, Google held roughly one-third of the market.

Google still has a significant presence in China with its Android mobile operating software and its online advertising business, and has been looking for growth opportunities.

In the U.S., Google launched an online store to sell music last year. The music service, part of the Google Play store for music, books, movies and apps, is available on desktop PCs and Android-powered mobile devices.'
china is a hard nut to crack ...

I think Google.cn tried to do the right thing for China, by giving away free(ad-supported) legal licensed music. But it seems China just went on stealing music regardless. :rolleyes:

BTW Apple has never even attempted to try and run the iTunes Store for paid music downloads in China, apart from Hong Kong. Probably because they know that very few people would be willing to pay for legal music downloads.
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