There's a battle of the bands taking place in China this week, as Google
If the selection appears skimpy, it's probably because major labels like Warner Music Group
It's still a great move, as the industry realizes that a sliver of ad-sharing revenue is better than no revenue at all. However, why did the market take Baidu's
Baidu still commands roughly twice the market share of China's search queries as Google. One would expect Baidu to be an even more attractive partner for the record labels in delivering ad-supported downloads.
Baidu has been under the ethical heat lamp for its practice of assisting in illegal downloads. Baidu doesn't host the renegade music files, but its thorough search engine points users to third-party sites where the MP3s are available.
This has made Baidu a litigation magnet. Several labels bonded together to sue search-engine sites such as Baidu and Sohu.com's
Either way, the labels have to realize that Baidu would be a better ally than an enemy. And now that Baidu has been caught with its hand in the cookie jar, following last year's fiasco over running sponsored ads for unlicensed pharmaceutical companies, Baidu realizes that its shareholders start to hurt if the company doesn't embrace white hat techniques.
So it's OK to see Google give legal music in China a shot. Big G is really just the opening act. Hopefully, Baidu won't be too cocky in waiting to come out as the headliner. Impatient audiences can fairly quickly turn against the main attraction.
Stock news, financial commentary, and your daily dose of Foolishness: Get plugged in to The Motley Fool on Twitter!
Baidu has more than doubled since being singled out to Rule Breakers readers three years ago. Google and Sohu.com are also Rule Breakers picks. Why are you missing out on these great stock picks? The answer may be waiting in free 30-day passes to any or all of the newsletters.
Longtime Fool contributor Rick Munarriz has been a fan of China's growth stocks for several years now, even though he does not own shares in any of the companies in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.