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How Google, Microsoft Capitalize On Music Service Audio Ads Tied To Search Engine Queries

Music services from Google and Microsoft will become profitable if they capitalize on audio ads similar to what listeners hear on Pandora. Rather than just location-based ads, the two tech companies need to tie search engine queries from Google and Bing to their respective music services and listener selections. In fact, the cross-channel marketing would give the two quite a leg up on Pandora, Spotify and others.

Microsoft expanded its Xbox Music service Monday, allowing subscribers to access about 30 million tracks on their iOS and Android devices via new apps for each operating system. Both apps provide basic access to free music, with the ability to sync and change playlists -- but like Pandora, listening to music requires an online connection.

From one sign-in, the update provides free streaming tracks on any Web browser through amusic player by signing up and signing in, all supported by ads. A no-ad listening experience is available too. Microsoft made the Xbox Music Pass available on PCs, tablets, Xbox 360, phone and on the Web. The playlist syncs up and saves favorites with all registered devices.

The Microsoft Windows 8 operating system (OS) users discovered Xbox Music because it's the default player for music files. The Surface Pro came with the service. This move opens these options to more people and gives Microsoft Advertising a method to strengthen one more cross-channel tie.

The service also sells downloadable tracks similar to iTunes. A forthcoming service will generate song playlists automatically based on genres or similar artists.

When Xbox Music launched in October, it only ran on Windows-supported hardware and on the Xbox video game system. The company planned to extend the service within a year.

Microsoft's mobile play, including the acquisition of Nokia handsets, will require cross-platform marketing and ad targeting. Audio ads will become the next search-supported revenue driver for Google and Microsoft.

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