are true, and if Google can actually get the labels to agree to what they want to do (a big, no huge “if”), Google Music sounds like it could be a very serious threat to iTunes.

Here’s the basic gist of what Google is supposedly proposing: they want to offer an online music store not unlike iTunes, but run entirely through the web browser (and perhaps an app on Android devices). But users would have the choice of downloading some content to their mobile devices to take on the go, or immediately putting it in a cloud storage locker, which users would pay around $25 a year for. From this locker, all music bought could be streamed to any web browser at no additional charge. And again, music could be downloaded to a mobile app for when you’re not going to be online.

Further, Google wants to make it so that every song on their service could be played once in its entirety once for free by any user. Currently, services like iTunes only allow you to hear 30-second snippets of songs before you have to buy them (though they’ve been trying to double this time allotment). After this one free play, the standard 30-second limit would apply. This is a similar model to what Lala offered, and users loved, until the service was acquired and shut down by, yes, Apple.

Lala also offered a social component that users were quite fond of, and social would be a key ingredient of Google Music as well. Billboard says that users might be able to share music playlists with friends — which, when combined with the one free play rule, could be very powerful. Undoubtedly, Google’s upcoming new social service/layer/whatever will be a part of this Google Music experience as well.

All of that sounds amazing. Just about everyone on the web (myself included) has been writing now for months, if not years, that iTunes needs to take its experience into the cloud. It’s going to happen eventually, but we always seem just another step away. Google, with all its online expertise, would appear to be closer. And if the service described above existed, there is no question I would use it. A lot.

But.

The big advantage iTunes does have is twofold: their device ecosystem and, more importantly, their agreements with the labels. While all tracks on iTunes are now DRM-free, for a long, long time they weren’t. So unfortunately, a lot of people are locked into using iTunes or Apple devices to play those tracks.

But Billboard notes that in addition to the music store, Google hopes to scan users’ hard drives to find music they already own and give them access to it in the Google Music system. According to Billboard, this may include not only DRM-free music bought legally through stores, but all music that they can identify. Something tells me that way too good to be true. But Billboard notes that the inclusion of P2P (read: illegal) tracks would be a key for getting this service up and running with a huge group of users. And Billboard thinks the labels may even agree to it, if they get something in return — something like Google fighting harder against illegal downloads going forward.

Billboard even speculates that Google could exclude P2P sites from search results in exchange. The problem there is if that happened, Google would face a shitstorm the likes of which they’ve never seen from all sides. Users would be pissed that they can’t find their favorite P2P sites, but everyone else would be pissed that Google would once again be going after net neutrality. So I simply can’t believe that’s going to happen.

But even without getting into that whole debate, Google is likely to have a tough road going forward getting the labels to agree to some of their basic desires for Google Music. Billboard says that Google is proposing a 50/50 spit on subscription revenues, but the labels will undoubtedly want more. Google wants a three-year licensing agreement, but the labels will undoubtedly want a shorter one to test out this system. And then there are the track purchasing prices themselves. They sound as if they’ll be similar to what they are on iTunes, but who knows. And, since there is a streaming component to this, what will that mean for the rights negotiations?

Apple’s big advantage is that they already have their label agreements in place. Google doesn’t. That’s exactly why Google has been staffing up with some big guns to negotiate all this stuff. But as everyone is well aware by now, dealing with the media industries takes a lot of time and a lot of compromise.

The word is that Google hopes to launch this service later this year. Can they possibly get all this ironed out in just a few more months? I certainly hope so, but I’m not going to hold my breath.

[photo: flickr/mark sebastian]

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Authors: MG Siegler

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