• by Laurie Sullivan  @lauriesullivan, June 24, 2010

Google and Microsoft are scrambling to find ways to please the entertainment industry. Both search engines this week launched separate music services. The move may gain points with recording labels, but it's not clear if they will satisfy artists. The stakes become higher for everyone as rumors heat up online about Google launching a rival music service to iTunes.

At a star-studded event in Hollywood to unveil the Entertainment section on Bing that enables consumers to play complete music tracks, T Bone Burnett, writer for the best original song, "The Weary Kind" from Crazy Heart, told the audience during a panel discussion on technology that Lady GaGa had 220 billion hits on one music video, but her total income from streaming music sales last year was $10,000 (we were not able to confim this figure).

Burnett described the creative process as time washing over the tip of a pyramid. There's plenty of room at the bottom to put in a lot of things, but time washes it down from the top into the sand quickly, he says. The artist's job is to put something right at the top and get it to stay there in an effort to be heard among the millions of voices now online.

The music industry and innovation will cease to exist unless there is an investment in music, Burnett says. "There are a lot of people making a lot of money today, but the creators of the music are not being rewarded at all," he adds, calling it dangerous for society and the industry. "Google made $28 billion in advertising last year. Their No. 1 search [category] is weather and No. 2 is music."

After Burnett told the audience the record industry dropped off 80% following the advent of broadcast radio, Seacrest interrupted to say "now it's getting personal," inviting him to KISS-FM studios where he hosts a morning radio show. Comparing old with new media, Burnett explained how music publishers and copyright owners persuaded broadcasters to share some advertising revenue because broadcasters played music for free and sold advertising.

Separately, musician Michelle Mangione took time out from a recording session with Grace Slick to talk with MediaPost. The two are working on a song related to the BP oil spill in the gulf. Mangione says music on the Internet still remains "a bit of a free-for-all" or experiment. She acknowledges that search engines have begun to try to help artists, and that some people pop over to iTunes after hearing the music to buy the track, but "generally people with the most money will always have the most exposure; and therefore, sell the most music." Artists are still trying to figure it all out, she says.

While Mangione believes it's all in a day's work to promote and market her music online, she'll now have help from Friendly Music. On Wednesday, Google's YouTube announced a deal with RumbleFish that allows independent artists to license their music for $1.99 to people who want to use the tunes as background for videos they upload to YouTube. The site, Friendly Music, launches June 29.

U.S. Internet users watched nearly 34 billion videos in May, and Google sites ranked as the top video property with 14.6 billion videos, representing 43.1% of all videos viewed online, according to comScore. It's not clear how many have music behind the video, but the new service from the company gives people a chance to add it and remain within copyright laws.

Google last year rolled out a way to search and discover music on its search engine through a service it calls Google Discover Music. The engine enables you to type in lyrics to find the song. Click the link to hear an audio recording to preview it through one of Google's partners. It also provides links to purchase the recording or learn more about the song.