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Google launches streaming music service

Google launched its All Access streaming music service ahead of Apple.

Google Inc.

SAN FRANCISCO - Google Inc. launched a music service on Wednesday which allows users to listen to unlimited songs for $9.99 a month, challenging smaller companies like Pandora and Spotify in the market for streaming music.

With its new service, announced at its annual developers' conference in San Francisco, Google has adopted the streaming music business model ahead of rival Apple Inc., which pioneered online music purchases with iTunes.

Google's All Access service lets users customise song selections from 22 genres, ranging from Jazz to Indie music, stream individual playlists, or listen to a curated, radio-like stream that can be tweaked.

It will be launched for US users first, before being rolled out to several other countries.

Google unveiled a string of improvements to other services, including new mapping features and a voice-activated search, at the conference.

The focus was on giving more options to users of mobile devices using its Android software. The operating system that now runs three out of every four smartphones sold.

Shares of Google, the world's largest Internet search company, jumped more than 3% while Pandora Media Inc. shares were down more than 1% on Wednesday afternoon.

Google's new music service amps up the competition in the nascent market for subscription-based streaming music Amazon.com Inc. and Apple are among the Silicon Valley powerhouses sounding out top recording industry executives, according to sources with knowledge of talks.

Pandora is spending freely and racking up losses to expand globally.

All these companies see a viable music streaming and subscription service as crucial to growing their presence in an exploding mobile environment. For Google and Apple, it is critical in ensuring users remain loyal to their mobile products.

With a music service, Google further locks consumers into its sphere of products and services, said Chris Silva, an analyst with Altimeter Group.

"They're trying to sell an ecosystem, the more things I'm doing, the more things that tie me to Google services." he said.

At $9.99 a month, Google's service is costlier than the $3.99 required for Pandora, but on par with Spotify.

The music service features millions of tracks from Universal Music, Sony Entertainment Group and Warner Music Group, as well as from thousands of independent labels, according to a Google spokeswoman.

Some analysts said the new service allowed Google to catch-up to offerings from the likes of Spotify, but did not offer anything unique. Forrester analyst James McQuivey said combining the service with video or game content might have made it stand out.

The futuristic-looking device has elicited admiration from many technology-lovers, but some have questioned whether the stamp-sized electronic screen mounted on eyeglass frames will appeal to mainstream consumers.

While many enthusiastic attendees and Google staffers strolled about the conference centre sporting the Glass devices, executives spent little time discussing it on stage.

Google missed an opportunity to "show that they think they're onto something big," said Forrester's McQuivey.