Google branches out

Early last year, when Google launched Google Video, it announced that it would, at some point in the future, allow videos to be sold or rented through its service. According to the terms it posted, video owners would be able to set their own prices and Google would take a 30% commission on any revenue. According to various media reports, the Google video store will be formally launched tomorrow by Larry Page during his address at the Consumer Electronics Show in Las Vegas. According to the Financial Times, “The search company hopes to position the new video service as the internet’s first ‘open digital content marketplace,’ a place where owners of video content can make as much of their material available as they want.” Page will announce that the store will carry programs from CBS and ITN as well as music videos from Sony BMG and NBA games (in addition, one assumes, to amateur-produced video).

But how “open” will this “open digital content marketplace” really be? The FT says that “access to the store will be through an iTunes-like interface that will require users to download a new Google ‘player’ onto their PCs.” According to the Wall Street Journal, “Google has developed its own digital-rights-management software to protect downloaded videos from piracy.” If these reports pan out, then this sounds like yet another closed system and yet more headaches for consumers. So much for media convergence.

For Google, this will be a landmark move, as it will open a new revenue stream beyond advertising. It will also test the company’s ability to create an attractive user interface outside the web search world. And, of course, it will put the company directly in the sights of another aggressive competitor – Apple – as well as Microsoft and Yahoo. Expect a fierce fight.