Google sets up free music service in China

31 March 2009

SUNNYVALE, California: Google, the online search giant, has teamed up with companies including Warner Music, Sony and Universal to launch a free online music service in China, which will be wholly funded by advertising revenues.

Consumers will be able to download free music from the new portal, with Google sharing ad revenues with its partners in the venture.

Alongside the major music firms and 14 independent music label, Google will be working with, a Chinese online music portal, on the service.

Over 90% of music downloads in China are illegal according figures from the International Federation of the Phonographic Industry, which also estimates up to 71% of China's 298 million web users have downloaded music from the internet.

Baidu – China's biggest search engine with a market share of over 62.2% in 2008 compared with Google's 27.8%, according to Analyses – already operates a music download service in conjunction with EMI.

Phorm, the online targeted advertising technology firm, is also trialling its behavioural advertising system with KT, South Korea's biggest internet services provider, the company has announced.

It has previously run controversial tests of the system in the UK with telecoms giant BT.

The OECD reports that Korea has some 15 million broadband users, with a penetration rate of around 90%, and KT states that it currently has a market share of 44% in the country.

ZenithOptimedia estimates that online advertising is worth $1.6 billion (€1.2bn £1.1bn) in Korea, a share of around 15.5% of total advertising expenditure in the country.

Data sourced from Bloomberg/Brand Republic; additional content by WARC staff