Internet search giant squashed rumors.

Don't look for Google to get into the digital music sales anytime soon.

The Internet search giant used a keynote slot at the annual the National Assn. of Recording Merchandisers (NARM) conference to squash rumors of a so-called “Gtunes” store—much to the delight of retailers attending the confab.

“We are not going to be selling music,” Chris Sacca, head of business development for Google, said in an Aug. 3 address to music merchants and distributors.

Talk of a Google digital music solution has been swirling for more than a year. A Bear Stearns analyst predicted in January that a Google rival to Apple Computer’s iTunes Music Store could come in a little as six months. And speculation has only intensified as the company has branched into selling music videos from Sony BMG via Google Video, and offering a new dedicated music search function.

But in the wake of a cool reception to Google video sales, and in the face of a challenging environment for digital rights management and device compatibility, the company appears to putting the brakes on expectations for a retail play in music and other areas of digital entertainment.

Instead Sacca stressed the need for partnerships and innovations to NARM attendees

Sacca says the big opportunity in digital music is in developing the ecosystem–one that allows consumers to move content from the home to the car and between devices with ease.

“I think once again there is an opportunity [to improve] ease of use,” Sacca said, likening it to the way Napster transformed search and discovery, and Apple revolutionized portability and shopping. “But to really grasp this takes a certain amount of humility to look beyond your walls.”

Sacca didn’t say how, if at all, Google plans to play a role in this. He noted the need for open source systems and protocols to drive collaboration among companies.

He said for the time being the company prefers to drive music fans to partnering retail, label, and artist sites with its core search technology and related products.

Those results can show up in search results; directed advertisements; posts from its Blogger weblog community; bands posting their touring information on Google Earth, Google maps and Google Calendar; and more.

He also touted Google’s ability to be used as a predictive tool for the success of albums and singles with its Google trends feature (goggle.com/trends), which tracks the popularity of search terms over time.

“We’re already in the music business, because we’re the compliment to the offline life,” he said. “After people hear the name Gnarls Barkley their next move is to go and check on Google for it.”

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