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By April 8, 2013 3 Comments

Apple and Google Go Head to Head

Apple and Google Go Head to Head

Apple and Google Go Head to Head

Rumors are doing the rounds that Apple Inc. (NASDAQ: AAPL) and Google Inc. (NASDAQ: GOOG) are ready to go head to head by launching their own music streaming services. This will put the two giants in direct competition as they will vie for a larger market share in an industry that is already saturated. As per a report by Fortune, Google is already in negotiations with YouTube and Apple, too, is looking at music labels to add streaming options to iTunes. However, there already are big giants like Microsoft Corporation’s (NASDAQ: MSFT) X-box Music and Amazon.com, Inc. (NASDAQ: AMZN) MP3 enjoying a big portion of the cake. In addition, small companies also have their own services like Pandora Media Inc. (NYSE: P). Amid such tough competition, it is difficult to tell how exactly Apple and Google will be able to make their mark. One of NPD’s streaming media analysts, Russ Crupnick, says, “The world does not need dozens of streaming services. There will be tremendous challenges to get some elbow room in the marketplace.”

Apple and Google already have some advantages due to being big names. Apple’s iTunes and Google’s Google Play are extremely well-known and used by millions of people around the world. Their brand recognition and sheer size will be of great importance in this scenario. But, being a big name is not enough. Several corporations with similar services have fallen in the last few years, including Napster Inc. (NASDAQ: NAPS). However, one cannot completely deny the advantages that these two have, especially the synergy with device businesses. Both can reach people by offering their services as pre-loaded apps on Android devices (Google) and iOS devices (Apple) giving people access to the app or the service. But then, emerging companies like Pandora have already carved their niches. As per numbers, Pandora is the third highest grossing application in iTunes Store.

Most experts believe Apple and Google do stand a chance but they will have to take risks and come up with foolproof plans as the window of opportunity is closing quickly. With so many similar services, they will all have to come up with unique ideas and something different to be able to catch one’s attention. The founder and publisher of the trade publication Digital Music News, Paul Resnikoff believes that “The jack of all trades approach usually isn’t the best.”

A good example is Leap Wireless International’s (NASDAQ: LEAP) Muve Music service that is available on all Cricket phones. It has over 1.4 million subscribers and is the largest subscription music service in the U.S. On the other hand, Pandora, with 66 million listeners in January, does not break out numbers for paid subscribers. Google has a giant advertising network that it can use to spread the word. In the same way Apple too, is a known name and has a loyal fan base that would be interested in its new service.

Experts believe that Google and Apple do have a chance at earning a good amount of revenue from this. How will this impact emerging companies? This again depends on how they handle everything. It would not be wise to entirely write them off as they already have listeners that won’t be switching easily. The right thing to do is to wait and watch the venture unfold.

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