Ever the disruptive force, Google on Tuesday launched a cloud-based music locker service, yet irked the music labels in the process. The big question now is whether it will survive without support or be embraced as a rival to iTunes.

At the Google I/O conference in San Francisco, the web giant revealed a beta version of Google Music. The service was designed to be a music store in the image of iTunes and Amazon, yet Google was unable to strike a deal with the record labels. So what was on display has been described as a “half way house” by some pundits.

The digital locker platform will allow users to upload their music collection to Google, and stream it back to their devices. With the project still in beta however, there are plenty of restrictions. The service is only available to US users by invitation, it allows for the storage of 20,000 songs free of charge, and only support Android devices. Google gets around the licensing issues by storing each users’ songs separately and ensuring they can only be streamed by their owner.

According to Simon Dyson, senior music analyst at Informa Telecoms & Media, the immediate impact of the launch of Google’s music beta service will most likely put an end to licensing negotiations between Google and the major record companies as well as most other companies looking to get into the locker space. Dyson focuses on the issue of whether a licence is needed for a company to operate such a music locker service and now that Amazon and Google have struck out without a licence, the suggestion is that one is not necessary.

“The implications surrounding the launch are massive. Amazon launching on its own was a risk, but having Google alongside it swings the balance of power in favour of the service providers and away from the record companies,” Dyson said.

“We are no nearer finding out if a license is required for this sort of service but that isn’t the point. Google has claimed that it tried to get a license and was denied by the major record companies. Google can only be seen as a defender of what consumers deserve and if the major record companies challenge this it could turn out to be a PR disaster for them.

Without being too dramatic, Google has effectively said to the record companies, sue us if you dare,” he adds. Now the labels are in a tricky position, they have wanted a challenger to the dominance of iTunes for a long time and although the Google launch only goes part of the way to providing this challenge, Google remains one of a small number of companies big enough to challenge iTunes.

In related news, Google also announced plans for a US service that will allow users to rent videos on Android devices, while the unveiling of Android OS update Ice Cream Sandwich will unite the tablet and mobile phone operating systems into a single programme.