2009-04-08 19:38:02 -

Google’s new music service, which was launched in China on March 30, is unlikely to help Google significantly improve its share of the Chinese search market according to the latest analysis from the Strategy Analytics’ Digital Media Strategies Service. This report, "Will Digital Music Help Google Triumph in the Chinese Search Market?", evaluates the impact of Google’s new music service in China on the Chinese search market, where Google has failed to become the market leader, and on the Chinese online music market, where the record labels have been unable to monetize digital downloads.

The report concludes that, while it is definitely a positive step in the right direction for Google to attempt to grow its user traffic and revenue in

the Chinese search market by offering innovative media services, the new music service is not enough to turn the market around, and its rival, Baidu, has little to fear from this latest move by Google.

“Google’s launch of its own music service in China is one of its recent attempts of localization, aiming to grow user traffic in the Chinese search market and to challenge local market leader, Baidu,” commented Jia Wu, Analyst at Strategy Analytics Digital Consumer Practice and author of the report. “However, Google’s new music service is not a magic pill to solve the problems Google has encountered in China”.

“For the record labels, this means an opportunity to experiment with new business models in the previously unmonetizable Chinese online music market.” said Martin Olausson, Director of Digital Media Strategies at Strategy Analytics. “In partnership with web technology pioneer Google, the record labels will learn from the new business model and may find a way to enhance revenue streams in the fast changing and uncertain digital environment in China”.

Analyst Blogs: www.strategyanalytics.com/blogs/author/dmercer :

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Strategy Analytics, Inc. provides timely and actionable market intelligence focused on opportunities and disruptive forces in the technology, communications and media industries. Headquartered in Boston, MA, with offices in China and around the world, Strategy Analytics works with clients through annual multi-client services, management team workshops and custom consulting engagements. For more information, please visit www.strategyanalytics.com/ :

US Contact:Strategy AnalyticsJia Wu, 617-614-0712 jwu@strategyanalytics.com : mailto:jwu@strategyanalytics.com orEuropean
Contact:Martin Olausson, +44(0) 1908 423 611 molausson@strategyanalytics.com : mailto:molausson@strategyanalytics.com