Google's Rubin: 'I think we're close' to launching digital music store

Google (NASDAQ:GOOG) senior vice president of mobile Andy Rubin has confirmed the digital services giant is poised to open its own music retail platform to rival established efforts from Apple (NASDAQ:AAPL) and Amazon.com.

"I think we're close" to rolling out the store, Rubin said during an appearance at the AsiaD conference in Hong Kong. He declined to offer specifics on the storefront, but said it will not simply mirror Apple's iTunes and the Amazon MP3 Store. "[The store] will have a little twist--it will have a little Google in it," Rubin said. "It won't just be selling 99 cent tracks."

Citing confirmation from numerous music industry executives speaking on condition of anonymity, The New York Times reported last week that Google is deep in talks with the major record labels to expand its cloud-based Music Beta streaming service and open an MP3 storefront. The Wall Street Journal reported only EMI Group is close to sealing a deal, with Universal Music Group, Sony Music Entertainment and Warner Music Group still in negotiations but far from finalizing terms.

Google first introduced Music Beta during its annual I/O developer conference in May 2011. The service enables consumers to upload and store their digital music collections via the web for streaming playback across Flash-enabled connected devices including Android smartphones and tablets as well as the desktop. Users may store as many as 20,000 songs for free--the service syncs activity on different devices, meaning that playlists created on the user's smartphone will automatically show up on their computers.

Like Amazon.com's Cloud Drive initiative introduced in late March, Music Beta by Google arrived without record label licensing agreements, meaning consumers are blocked from sharing songs with friends or purchasing premium downloads from Google. Major label executives have indicated that Music Beta talks broke down earlier this year because they felt Google failed to properly address their piracy concerns. The New York Times states that Google's expanded plans still leave doubts about content security: "We want to make sure [Music Beta's web-based music storage] locker doesn't become a bastion of piracy," one senior-level label exec said.

At AsiaD, Rubin said Google has struggled to come to terms with the labels because media companies in general have been unable to reconcile their perception of the Google platform with what it is becoming. "Google is in the very very early phases of adding consumer products to our portfolio," Rubin said. "The media industry didn't see us as that. They saw us a search company."

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