Google is reportedly in the advanced stages of testing a music service that could one day rival Apple iTunes.
The latest reports that the company is internally testing the service, dubbed Google Music, come just weeks after a developer at the XDA Developers forum noted online that he stumbled upon Google Music when he fired up the Honeycomb version of Google's Android operating system on a smartphone.
Both reports come amid ongoing online rumours that Google is working away on a social networking platform behind closed doors.
Google's social puzzle
For months now, online chatter has focused on whether Google is secretly trying to build its own social network, which would focus on gaming, music and/or movies. Potential names for the service include Google Me and Google Circle.
Analysts say Google Music is not likely to be the social platform that the industry has been anticipating. However, some note that it could be a big piece of Google's social puzzle.
"I don't see this serving as Google's primary, stand-alone social networking service with which it will compete with Facebook et al," said Brad Shimmin, an analyst with Current Analysis.
"That won't preclude Google from releasing a broader, general social networking platform. If anything, this music service will incorporate social networking facilities, perhaps tying into... any potential Google offerings, such as the rumours surrounding a Google Me service," he added.
Hadley Reynolds, an analyst with IDC, agreed that Google Music won't be the company's social platform. "The music service category is well-defined on its own terms at this point," he said.
Reynolds said it would be a good idea for Google to take on Apple and its popular iTunes service. While iTunes has had a significant head start, a similar service from Google for Android devices could chip away at Apple in a lucrative business.
"The iPod and iTunes, and later the iPhone and the iPad and iTunes, has given Apple close to a decade to define this mobile music experience in its own terms," said Reynolds. "The proliferation of Android devices is creating a customer base that will pull Google into competition with Apple in these areas."
And this might be a good time for Google to go after iTunes as Apple must make moves to fend off competition on another front as well.
Amazon.com announced yesterday that its new Cloud Drive online storage service will enables users to store music in the cloud and, in the US, stream it to an Android app.
Previously, Amazon has offered an MP3 store where customers can buy music using a web browser or the MP3 app for Android, which now includes the Cloud Player functionality.
That means Google, Apple and Amazon may just be vying for a lot of the same customers.
"Interestingly, both Google and Amazon target the Android device as their player of choice, which in a way does encourage greater competition between Android and iOS in terms of offering customers with a rich music experience on both devices," said Shimmin.
Shimmin said Google has a good shot at making a go of a music service if it's able to build a strong record label ecosystem.
"I don't think this can turn into a losing proposition for Google," he added. "I think it's an important move to further secure and bolster Android's popularity as a mobile device capable of matching Apple's iOS blow for blow."