Jamie Rosenberg, Director of Android Product Management, to spill the details a bit early. Google's service will essentially mimic the music locker functionality of Amazon's Cloud service, albeit without the ability to sell songs direct to consumers. Ouch. Unfortunately, Google's plans to launch a more feature-complete service were derailed when discussions with the labels broke down. According to Rosenberg, "A couple of the major labels were less focused on the innovative vision that we put forward, and more interested in an unreasonable and unsustainable set of business terms." So, rather than putting the service on hold, Google will launch its music service with the ability to store up to 20,000 of your own uploaded songs for free which you can then stream over the web to your desktop or Android phone or tablet
how is exactly is this a solution to the record label's concerns? google will still be distributing (streaming) copyrighted material = one, they may be liable for illegal copies (ex: storage of unreleased albums, and does the user have to prove that they have the right to their music collection?); and two, will google be paying royalties for the performance?
given current laws, i'm not sure how these cloud services can move forward. having users upload their music collections doesn't get around the law, as far as i can tell... but i'm not the lawyer here.