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Conspiracy theorists convinced that Google (Nasdaq: GOOG) wants a footprint in every single business category on the planet got some more ammunition Wednesday: reports that detail the company's possible efforts to extend into both branded smartphones and online music.
Manufacturers are working on a Google-branded phone that would be offered directly to consumers via retail 
outlets and not traditional wireless carriers, according to Northeast Securities analyst Ashok Kumar. This highlights Google's efforts to provide more customizable phones to consumers and perhaps in the process help rewrite the way new smartphones and related services are brought to market.
Google may also be very close to launching a music-related search service, according to a report from TechCrunch. The service apparently will not offer actual song downloads, but users would hear streamed snippets courtesy of potential partners like Lala or iLike.com, along with more targeted search results.
Google did not respond to requests for comments regarding the possibility of a music search service. Regarding a Google phone, company spokesperson Katie Watson told TechNewsWorld "we don't comment on market rumor or speculation."
A Phone of Google's Own?
Google has seen substantial success so far with its Android operating system and its efforts to line up hardware and telecom carrier partners for that platform, according to Northeast Securities' Kumar. A Google-branded phone that bypasses exclusive carrier relationships would just be an extension of that.
"The Android platform is real. They've gone from a standing start to some market share, which is very enviable in a highly competitive smartphone market," Kumar told TechNewWorld. "They have showcased what can be done with the technology through its ecosystem partners. They're realizing that, so they're stepping forward to essentially showcase the owner of the brand. The hardware is increasingly being commoditized, so the value is in the software. The value is also shifting to the cloud, which Google controls -- they're the ultimate gatekeeper for the cloud, and the business is moving in that direction." It's all about the "cathedral versus bazaar" business models, Kumar said. The cathedral is Apple (Nasdaq: AAPL), whereas the search giant trying to push things more toward the horizontal, or bazaar, process of selling phones, "where the real power is in the cloud."
What Google may be proposing is "a similar model in other parts of the world where the carrier infrastructure is not as complex as ours," said Ben Bajarin of Creative Strategies. "[Carriers] have got to know to make the investment to support a more open, hands-off environment. They should be really about providing quality services -- that's where they're going to compete. Controlling the hardware is a losing battle for them."
Searching for Songs and Revenue
Trying to control a new iTunes-like Google music service might also be a difficult proposition for the search company, considering the one-on-one relationships required with music labels. "It's a time-intensive and costly endeavor," Bajarin told TechNewsWorld. "This would be a first step for Google to establish themselves with a connection to a more tangible acquisition of a digital asset, which is a song. But it's also leveraging what they've already got perfected in search."
Google might try to follow its own example regarding video searches, which provide more targeted, relevant and complimentary video results, Bajarin said. That's a sentiment echoed by Greg Sterling, principal analyst at Search Market Intelligence, who emphasized that the company's plans would also allow them to better position its YouTube division.
"If there's no download, then there's more limited revenue potential," Sterling told TechNewsWorld. "It would be an enhancement to the user experience, and potentially it could also boost YouTube for music-video viewing -- not that it needs any more visibility. Ad revenues could be generated from additional searches and YouTube views -- brands, artists, labels."
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