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Why Google Thinks It Can Challenge Apple’s iTunes

The company is expected to unveil an online music store in direct competition with Apple’s iTunes on Wednesday

The war between Google and Apple is moving to a new frontier — music.

Google is expected to unveil an online music store on Wednesday in its latest assault on the Cupertino, Calif.-based company.

The tech giants have already tussled over Google's Android technology and the mobile phone market. Both also want to take the television industry by storm and wring as much money as possible out of video streaming. 

But this is another battle all together.

The new Google music service represents a direct challenge to Apple and its iTunes Store, the dominant digital music purchasing service, and a cornerstone to Apple's resurgence under late co-founder Steve Jobs.

Also read: The Next Game-Changer: Apple to Release TV Late Next Year?

Like rival Amazon, both companies plan to leverage cloud technology with their music services.

“So, what’s happening here is that people are battling to be the primary repository service agent for people’s digital content, and by content I mean personal content as well as commercial content,” said Frank Gillett, a principal analyst at Forrester Research.

The particulars remain unclear since Google is declining to comment on its music service in advance its launch, including for this story. Apple did not respond to inquiries, either.

However, several details about Google's music service have been widely reported.

>> Google is enhancing the Music Beta service it launched in May, which allowed people to upload their digital music files to an online locker.

>> The new service will apparently include licensing deals with three of the four major labels — EMI and Universal, which are awaiting regulatory approval on a merger, and Sony.  A source close to the negotiations confirmed to TheWrap that Universal and EMI were in; the Wall Street Journal reported Sony has agreed as well. Sony did not respond to requests for comment.

>> The service will also enable users to share a free listen or two of a song using the Google + social networking platform.

>> Most important, there will be a store, and this is where the challenge to Apple comes in.

Over the past decade, iTunes has become the king of the digital download market — at least in the legal realm.

And though newer subscription services like Spotify may be the future, the Dutch import doesn’t even have 1 million subscribers in the U.S.

Also read: Amazon Looks to Take Bite Out of Apple, iTunes With Cloud Storage Service

Meanwhile, iTunes has been universally adopted and Apple’s latest addition — iTunes Match — makes it even better.

For $25, Apple will now upload one’s entire library to the iCloud, making it accessible from any device.

Now Google, whose Music Beta has yet to make a big splash, is upping the stakes.

“You know Google has to catch up with Apple," said Robert Levine, author of “Free Ride,” a book about how digitization has affected cultural industries like music and film. "For a company that has done everything to question the value of intellectual property, when Apple launches a cloud-based music service, they [Google] rushed to launch one anyway.”

Like their fellow Silicon Valley monoliths, the two companies have shown a willingness to butt heads in other side businesses to protect their core interests.

“There are really only a couple of tech titans — Facebook, Microsoft, Amazon, Google, Apple and Twitter — and they’re all scrapping together and forming little alliances and getting in fights,” Wired writer Clive Thompson said.

For the most part, Google is willing to cede the consumer technology market to Apple, and Apple will accept Google's dominance in online advertising.

They will fight over everything else, seeking to gain every edge they can, shifting allegiances in order to keep one another off balance and on the off chance that they may happen upon the next great idea.

Of the current tech giants, Amazon, Google and Apple are the current leaders. Facebook and Twitter are much smaller.

Also read: The 'iCloud' Rolls In: Will Apple's Technology Reign Continue?

Microsoft, once Apple’s chief rival, is fading. So who has taken Bill Gates' place? Google.

Like Microsoft before it, Google is less interested in going to market with a fully realized product and more interested in establishing a toe hold. Google’s new service is as much about competition and consumer information as music, long-time tech watchers say.

"I think there are several players — Apple, Amazon, Google, and to a lesser extent Yahoo — they are all going to expand into all the areas that they can, and they can afford to do so," technology writer Robert Cringely told TheWrap.

Google wants to get more information about its users and it wants to make Apple sweat. If the service makes money too, all the better.

"Google is not expecting to dominate the music business unless it plans to give away songs for free, and it's not going to do that," Cringely said.

So it may not concern Google if its new service does not pose a real threat due to iTunes’ dominance.

“It’s gotta be as easy to use as iTunes and in some way better enough than iTunes to get people to switch,” Levine said. “If you want to disrupt something, you have to deliver people something that makes you go ‘holy s—!’ Is this good enough to make you go holy s—?”

At this point, it doesn’t appear likely.

“This isn’t an experiment at all," Thompson pointed out. “This model has been around for six or seven years.”

Google music users will have to upload the music on their own for free rather than have it done automatically for $25. Worse, they will not be able to access that music without an internet connection.

Finally, music will be missing since not all of the major labels have signed up. While EMI, Universal and Sony are expected to be in, Warner, on the smaller side of the “major” scale, is not. Cringely said that record companies are wary of deep pocketed players like Google.

"They might take $5 billion, and buy a record company," he said. "Those guys are crazy — they’ve got a lot of cash, and they’re willing to spend it."

As for the social aspect of Google's music service? Levine doesn’t consider it all that beneficial.

“What’s the most successful music product over the last decade? The iPod. What does it let you do? Listen to music by yourself," he said. "It’s the ultimate anti-social experience."

All this begs the question: Why music? Why now?

Could the answer be this simple? Because Apple did it.

Brent Lang contributed to this report.