It reads your mind to download it?
... Why do you go out of your way to confuse a matter?
No*, it doesn't make a distinction between downloading and streaming, local or <cloud>. If you find a song and play, it doesn't ask you if you wish to 'stream' or download like the IOS5 example.
As I understand both services (from people's statements here) the IOS5 has a 'switch' that decides whether to leave the file on the device after playing or not. The download button just makes the file non-cache. (GMB may have something similar --- I don't have either** platforms so can't test myself.)
I would argue that the IOS5 is the better solution as people (non-technical) can understand it without a visible learning curve. But they are the same damn thing.
* Based entirely on the examples in the article, people's streaming, and the Google Music Beta website. No tests nor analysis of code has been done. Just plain reading without an obvious agenda.
** No smartphone at all; yet ... ;D
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...back in the late 90s, Apple had 'streaming' for its videos that worked exactly this way, and everyone roundly mocked them for calling it streaming. "They're just downloading, and starting play before they finish downloading! THAT'S NOT STREAMING!"
No. As it turns out, it's better. In pretty much every way. (For everything but live streams, which are a whole different kettle of corn.)
I remember that. It was hard to understand why people had a problem with it.