Filed under: Launches, Consumer experience, Competitive strategy, Google (GOOG), Apple Inc (AAPL), Amazon.com (AMZN), Nokia Corp. (NOK)

Nearly each consumer electronics company and massive website has a way for people to download songs and pay for them. Even Nokia (NYSE: NOK) has set up its own system to help it sell its handsets.

Now Google (NASDAQ: GOOG) wants in. It will grant users of YouTube to download songs from Apple (NASDAQ: AAPL) iTunes or Amazon’s (NASDAQ: AMZN) service. A YouTube visitor can watch a music video and then get the music. According to The New York Times, “If you like the song, you don’t need to leave Google or leave the site to buy it,” stated Bakari Brock, business affairs counsel at YouTube.

Google may have trouble making money on YouTube, but the program is probably not the answer. The system supposes a radical change in on the internet behavior where most people looking for songs go to music download sites such as iTunes and people who want to watch low-quality video go to YouTube. A music video on YouTube grants consumers to listen to a song for free. That might undermine getting people to pay for it, and some YouTube visitors may just pirate the music.

The new service is an example of how the failed economics of online video and social websites such as Facebook have forced the companies to do almost anything to bring in money. The faltering online advertising market will probably increase the number of these programs, but that does not mean that they will work.

Douglas A. McIntyre is an editor at 247wallst.com.

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This entry was posted on Saturday, October 11th, 2008 at 1:01 pm and is filed under Companies Competitive Strategy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.