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Apple inks deal with Warner Music for iTunes cloud service - report

post #1 of 25
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Apple has reportedly reached an agreement with Warner Music, the third-largest record label, for its anticipated cloud-based music streaming service.

Citing sources in the music industry, CNet's Greg Sandoval reported Friday that Warner Music Group and Apple have reached a deal for Apple's unannounced iTunes cloud service. Warner Music is home to major acts including Linkin Park, Flo Rida and Green Day.

A day earlier it was reported that two of the four major record labels have agreed to Apple's streaming plans. It is unknown whether Warner is one of those two unnamed labels, or a third major player that has signed with Apple.

Apple Vice President Eddy Cue is believed to be in New York in an attempt to reach deals with the remaining labels. Industry executives were quoted as saying that Apple has been "aggressive and thoughtful" in its negotiations.

Exactly how Apple's rumored cloud service will operate and how much, if anything, it will cost to stream music remains unknown. But the fact that Apple is reaching agreements with labels makes it unlikely that Apple's product will rely solely on users uploading their own media, as Amazon has done without record label participation in its own recently launched cloud storage and streaming service.

Earlier Thursday, Reuters reported that Apple has "completed work" on the long-rumored iTunes streaming service. It said Apple is "set to launch" the product, which will allow users to store their songs on a remote server and access them from an Internet-connected device.

Cloud streaming would allow users to access their media, including large music libraries, without needing to take up local storage on an Internet-connected device like an iPhone.

Music industry executives have reportedly agreed to terms with Apple without actually seeing the new streaming product. Apple has only shared "broad strokes" of its plans, but has led those executives to believe that the service could launch "pretty soon."
post #2 of 25
If you build it they will come.
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post #3 of 25
Is this the mysterious May event launch? iTunes streaming/MobileMe event?
post #4 of 25
Just like developers for the Apps Store, Apple should consider direct submission of music and video, especially after the NC facility is already operational. In a similar fashion, artists may do this individually or band together as smaller labels or companies to deal with Apple, just like what is happening now among developers for the Apps Store.

One advantage of this is that, just like developers for the Apps Stores, the artist has the option to set the price of their creations, or even give them away for free as promotion. More than likely, the premium price of music and video from such a setup would not exceed the maximum price of that for record labels. The collateral effect would be a pressure to record labels to "lower" their own prices, if such a direct artists submission becomes successful.

With proper curation (under very defined and more loose rules and policies) and more active promotion, including integration with Ping or similar Apple-based social-networking, quality songs are bound to emerge and will be spread through viral promotion coming from satisfied customers.

Apple could even use its growing Apple Retail Stores as venue to promote such artists. I have seen them doing that now at a smaller scale for artists and writers using Apple products and Apps. Considering how music and video are so critical to the Apple Ecosystem, it should not even be farfetched to explore quasi tie-ups with independent recording and video-editing studios. Quasi in the sense that Apple need not have to own or create these studios but foster their business through subsidies. e.g., for time-restricted exclusive content rights for the Apple Ecosystem

If such a sytem of direct artists submission is created successffully, the Apple Ecosystems for music and mass media may become less dependent on record labels. Apple becomes the de facto "record label" for independent artists and smaller artists collaboratives.

Apple Ecosystems
post #5 of 25
Amazon's preemptive move to get a cloud music service going without licensing terms helped push the labels in Apple's direction. The labels probably wanted there to be an active bidding situation, but Amazon killed the process by announcing their service. That's a good thing because we're getting the service more quickly, even though Apple's offering may not be much different from what lala was offering before Apple acquired them.
post #6 of 25
Why is it that Amazon can get away with cloud storage and streaming service and not have to sign any music company contracts? Do they know something that Apple doesn't know or are they allowed to get away with more because Amazon is a smaller company. Maybe as soon as Apple signs up, it will open the door for Amazon to sign. Knowing Amazon's luck, they'll just slide right in and investors will go crazy when shares rocket again.

I'm willing to bet when Apple gets its cloud service up and running, shares will stay flat as ever. Apple will have to offer something special beyond what Amazon can offer in cloud storage if it expects to make any impact with Wall Street. Apple needs to get something back for investing $1 billion unless the data center is only being used to boost hardware sales.
post #7 of 25
Quote:
Originally Posted by Constable Odo View Post

Why is it that Amazon can get away with cloud storage and streaming service and not have to sign any music company contracts? Do they know something that Apple doesn't know or are they allowed to get away with more because Amazon is a smaller company. Maybe as soon as Apple signs up, it will open the door for Amazon to sign. Knowing Amazon's luck, they'll just slide right in and investors will go crazy when shares rocket again.

I'm willing to bet when Apple gets its cloud service up and running, shares will stay flat as ever. Apple will have to offer something special beyond what Amazon can offer in cloud storage if it expects to make any impact with Wall Street. Apple needs to get something back for investing $1 billion unless the data center is only being used to boost hardware sales.

There are several reasons to consider. Off the top of my head:
  1. Apple service is different from Amazon's in the way it works, even if on the front-end it's still just streaming music.
  2. Amazon is the underdog in digital music compared to Apple so they feel they can fly under the radar whilst Apple feels they can't.
  3. Amazon may think their previous affiliation with hte labels to offer them DRM-free music well before Apple in an attempt to weaken Apple's position as a music retailer may make them feel they had carte blanche maneuvering to usurp Apple again.
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post #8 of 25
Quote:
Originally Posted by Constable Odo View Post

Why is it that Amazon can get away with cloud storage and streaming service and not have to sign any music company contracts? Do they know something that Apple doesn't know or are they allowed to get away with more because Amazon is a smaller company. Maybe as soon as Apple signs up, it will open the door for Amazon to sign. Knowing Amazon's luck, they'll just slide right in and investors will go crazy when shares rocket again.

Amazon took a risk and the labels didn't know how to react immediately. Kudos to Amazon for having the balls to do it. Now the labels will use Apple's deal to dictate terms to Amazon. Apple will probably create a differentiator by not requiring uploads, which are needed for just about every cloud music service right now. I bought an album at Amazon to get the 20 GB limit. Last night I uploaded 15 GB. That took over 12 hours. Most people aren't going to do that. Apple will do what it does best: make things easy for the consumer.
post #9 of 25
Apple has arrived late to the music cloud service business. I am already using the best cloud service and I have it on my homepage. I listen to my music anywhere I go.
post #10 of 25
I think AI needs to commission some more mods to scrape this spam off this skillet.
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post #11 of 25
Quote:
Originally Posted by apple-ecosystems View Post

Just like developers for the Apps Store, Apple should consider direct submission of music and video, especially after the NC facility is already operational. In a similar fashion, artists may do this individually or band together as smaller labels or companies to deal with Apple, just like what is happening now among developers for the Apps Store.

One advantage of this is that, just like developers for the Apps Stores, the artist has the option to set the price of their creations, or even give them away for free as promotion. More than likely, the premium price of music and video from such a setup would not exceed the maximum price of that for record labels. The collateral effect would be a pressure to record labels to "lower" their own prices, if such a direct artists submission becomes successful.

With proper curation (under very defined and more loose rules and policies) and more active promotion, including integration with Ping or similar Apple-based social-networking, quality songs are bound to emerge and will be spread through viral promotion coming from satisfied customers.

Apple could even use its growing Apple Retail Stores as venue to promote such artists. I have seen them doing that now at a smaller scale for artists and writers using Apple products and Apps. Considering how music and video are so critical to the Apple Ecosystem, it should not even be farfetched to explore quasi tie-ups with independent recording and video-editing studios. Quasi in the sense that Apple need not have to own or create these studios but foster their business through subsidies. e.g., for time-restricted exclusive content rights for the Apple Ecosystem

If such a sytem of direct artists submission is created successffully, the Apple Ecosystems for music and mass media may become less dependent on record labels. Apple becomes the de facto "record label" for independent artists and smaller

Apple Ecosystems



Again, I think you're on to something.

It may be difficult, but not impossible, to offer an Indie portal as well as a Label portal.

I believe that Apple is best suited to do this and the have the chutzpah to carry it off.


In another thread I referred to a blog that discussed the new FCP (FCPX) and how the author had a vision for selling content (videos, images, talent) on the iTunes store.

Here is the blog:

Final Cut Studio - Upgrade Predictions and Ideas!


Again, this is mostly about FCP-- but it discusses an Apple Content Store -- and there are many interesting thoughts about it. It is rather a long thread -- but a very good read.


I have an unsigned friend who is about ready to publish her 1st CD, and through her and her managers I understand a bit about the Industry -- and its pitfalls.

As I read the blog, i felt as if I were seeing the future of content distribution revealed before my eyes.

Below is a sample:

Quote:
"Apple Content Store": OK, there is one more thing.... I like this idea so I saved it for last. It is merely an extension of the upcoming Mac App Store, but features user-created content for sell or license. Videographers can sell and buy footage, Directors can view and contact actors or other people via portfolios and auditions (with Facetime integration), photographers can sell photos, find and audition models. The possibilities are quite broad, but the interface remains very similar to the App Store for iOS. It takes just seconds to get a clip, graphic, sound or audition. Most clips are relatively inexpensive and your usage of them is tracked by Aperture or the cloud-based itunes licensing servers. This would replace shutterstock and istockphoto instantly since pricing could be quite low (with a simplified one-click checkout) and services like shutterstock could add their content for extra exposure. Apple computer has the cash to buy several, or even all of these companies if they wish to launch the service with a splash. Apple takes a flat rate percent of all purchases like they do with the App Store, but free content is encouraged by having no Apple fee. This is where you buy your plugins too, each priced very reasonably making it easy to just buy them ala carte. If you don't use the Clock Wipe, why pay for it? This makes the base apps very affordable, and you build on them if you are pro ala carte. All Apple apps can access the Content Store, including Aperture, FCP, Logic and even Keynote and Pages. If you have footage you want to sell or license, just upload it fill out a form within your Metadata presets of Aperture. Animators can build creative elements and presets that use the FCP dynamic flow chart system like the new iMovie does with the movie preview creator. You can sell these to everybody, including Keynote users in a traditional stock usage, or obtain contracts to create unique work via the auditions system. Apple opens up access to it from 3rd party apps, allowing InDesign, Flash and anyone else to use the Store through a plugin, assuming that these apps check in with the licensing server to prevent usage violations. Clearly it needs to be named something besides "Apple Content Store", but the concept here is very sound. It could be the biggest idea in our industry's history if done well, and I know no other company capable of this than Apple at the moment.
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post #12 of 25
I doubt if this service will be very useful to those of us who are meticulous about our iTunes libraries, appreciate high fidelity, and have slowly built up our libraries through careful CD ripping and vinyl needledrops at lossless or full bitrate.

Even putting that perspective aside, what if a newer remaster comes out after a buyer has already purchased a given title from the iTunes store? Do they get upgraded (or downgraded, given recent trends) for free?

In many cases, masterings from CD's released during the late 80s/early 90s are considered to sound much better than the highly maximized/over-EQ'd remasters coming out these days.

So from this perspective, Amazon's multiple copy model - though highly inefficient - is the better solution.
post #13 of 25
Tell us! What are your cloud plans! What's with the massive data center? What is the future of MobileMe?

Time's up!

(and I still want .mac back as an option for emails. .me is lame.)
post #14 of 25
Thanks for the blog link Dick Applebaum,

This is a subset of the proposal I espoused in another thread. Indeed, Apple must become a conduit of "contents" directly coming from artists, developers, writers and other creators. The NC Facility and other similar facilities rumored to be established in other countries are key to this goal, and so do the other components of the Apple Ecosystem already in place.

The key in my proposal is the curation (albeit more loose with general principles and guidelines) to ensure a minimum standard and encourage quality work.

Apple should spend some of its $65 billion reserve to buy innovative small startup companies to create the applications to enable the ecosystem required and integrate it to the Apple Ecosystem. However, Apple should not waste its resources buying existing or traditional labels or conduits -- Netflix, Movie Studios, cable company, etc. -- as some have suggested in other threads. This may saddle Apple with "management" and physical resources that are not germane to the focus of the company. The strategy not to own these studios and companies may avert any monopoly concerns in case the Apple-centric content conduit becomes very successful.

The important outcomes of this proposal are:

1. Apple will be less dependent on current traditional sources of creation, and thus, would have greater bargaining power.
2. Creators would have alternatives and more freedom to decide how their creations should reach their target audience.
3. By default, these creators may become consumers of Apple products, if they are not already long time consumers. And, since some if not many of these creators may become famous, their use of Apple products would be more effective advertising to their followers.

What are the pitfalls you saw? One thing that I see is that the process of "creation" is not an assembly-line. There might be periods of productivity and its reverse -- what is called "artist block" or "bust". This is one reason why I espouse that Apple should not be wasting its resources acquiring such companies or content creators.

In regard the Final Cut Pro, there is a more recent review that I bookmarked. It is written by someone who hobnobs with the Board of Directors of Apple, who happened to be in the presentation, apart from the major brains behind the project. It is supposed to be well-received. including a standing ovation after the presentation and the price has been drastically reduced to $299 or thereabouts. It is beyond me though, but to my knowledge did not integrate the Aperture features espouse by the author in the blog link you cited. One thing that the reviewer imparted is that the FCP presentation was demonstration of the direction and ideas that Apple were integrating in the revised FCP to gather feedback from the core users. There might still be revisions between then until its final release, this summer.

Apple Ecosystems


Quote:
Originally Posted by Dick Applebaum View Post

Again, I think you're on to something.

It may be difficult, but not impossible, to offer an Indie portal as well as a Label portal.

I believe that Apple is best suited to do this and the have the chutzpah to carry it off.


In another thread I referred to a blog that discussed the new FCP (FCPX) and how the author had a vision for selling content (videos, images, talent) on the iTunes store.

Here is the blog:

Final Cut Studio - Upgrade Predictions and Ideas!


Again, this is mostly about FCP-- but it discusses an Apple Content Store -- and there are many interesting thoughts about it. It is rather a long thread -- but a very good read.


I have an unsigned friend who is about ready to publish her 1st CD, and through her and her managers I understand a bit about the Industry -- and its pitfalls.

As I read the blog, i felt as I was seeing the future of content distribution revealed before my eyes.

Below is a sample:
post #15 of 25
Quote:
Originally Posted by Constable Odo View Post

Why is it that Amazon can get away with cloud storage and streaming service and not have to sign any music company contracts? Do they know something that Apple doesn't know or are they allowed to get away with more because Amazon is a smaller company. Maybe as soon as Apple signs up, it will open the door for Amazon to sign. Knowing Amazon's luck, they'll just slide right in and investors will go crazy when shares rocket again.

I'm willing to bet when Apple gets its cloud service up and running, shares will stay flat as ever. Apple will have to offer something special beyond what Amazon can offer in cloud storage if it expects to make any impact with Wall Street. Apple needs to get something back for investing $1 billion unless the data center is only being used to boost hardware sales.

Amazon isn't getting away with anything, the industry is steaming mad with them over their bold move....plus the service has been down for 2 days so...
post #16 of 25
Quote:
Originally Posted by Constable Odo View Post

Why is it that Amazon can get away with cloud storage and streaming service and not have to sign any music company contracts? Do they know something that Apple doesn't know or are they allowed to get away with more because Amazon is a smaller company. Maybe as soon as Apple signs up, it will open the door for Amazon to sign. Knowing Amazon's luck, they'll just slide right in and investors will go crazy when shares rocket again.

I'm willing to bet when Apple gets its cloud service up and running, shares will stay flat as ever. Apple will have to offer something special beyond what Amazon can offer in cloud storage if it expects to make any impact with Wall Street. Apple needs to get something back for investing $1 billion unless the data center is only being used to boost hardware sales.

What? I need to pay the RIAA each time I play my music from the cloud? Screw that crap. I do not feel it also necessary to pay for the privilege of re-downloading my music I paid for, anymore that I would have to buy a new CD (in the old days) if it got damaged.

So far the law is on Amazon's side.
post #17 of 25
Quote:
Originally Posted by sprockkets View Post

What? I need to pay the RIAA each time I play my music from the cloud? Screw that crap. I do not feel it also necessary to pay for the privilege of re-downloading my music I paid for, anymore that I would have to buy a new CD (in the old days) if it got damaged.

So far the law is on Amazon's side.

Who said anything about paying the RIAA each time you play your music from the cloud? Why are you using CDs as an example, since you did have to, in fact, repurchase them if they got damaged? What law is on Amazon's side?

You're so intent on finding Apple wrong at all costs that you've ceased making sense. Really, you sound like a loon.
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post #18 of 25
Quote:
Originally Posted by Double0Diablo View Post

Even putting that perspective aside, what if a newer remaster comes out after a buyer has already purchased a given title from the iTunes store? Do they get upgraded (or downgraded, given recent trends) for free?

I just don't understand this sentiment at all. When a remastered CD comes out, you have to re-buy the album. Why would it be any different with iTunes?

I hope the new cloud service would be so much more than music streaming. I hope it will be the ultimate iTunes sync like the way Dropbox synced our files.
post #19 of 25
LOL Amazon is a fucking amateur when it comes to music. What is the point of uploading your own music and stream them to you when you can stream them form your own device. Not to mention most of the music are probably pirated MP3 music.

In another news, Amazon Elastic Cloud suffered a major outage and now has entered its second day. Customers are furious.

http://news.cnet.com/8301-30685_3-20...?tag=mncol;txt

Are you going to trust an amateur like Amazon to stream your music?


Google is another amateur. They DONT WANT to pay anything. Their latest discussion with the labels: Google is only going to store the first 500 tracks of music on their cloud for free. If you want more, you have to pay. Google is not paying, you are paying.
post #20 of 25
Quote:
Originally Posted by addabox View Post

Who said anything about paying the RIAA each time you play your music from the cloud?

You do know that the RIAA = the major music labels, right?

Quote:
Why are you using CDs as an example, since you did have to, in fact, repurchase them if they got damaged?



Quote:
What law is on Amazon's side?

Copyright law.

Quote:
You're so intent on finding Apple wrong at all costs that you've ceased making sense. Really, you sound like a loon.

Newsflash for you buddy: The music lables aka the RIAA are on record as saying that if you make a copy of your music from a cd, that you stole one copy from them.

What the RIAA wants and what the law says are two different things. If you want to be stupid and give into them, go right on ahead.
post #21 of 25
Quote:
Originally Posted by IronTed View Post

LOL Amazon is a fucking amateur when it comes to music. What is the point of uploading your own music and stream them to you when you can stream them form your own device. Not to mention most of the music are probably pirated MP3 music.

Because you can use it for other stuff other than music???

Quote:
In another news, Amazon Elastic Cloud suffered a major outage and now has entered its second day. Customers are furious.

http://news.cnet.com/8301-30685_3-20...?tag=mncol;txt

Are you going to trust an amateur like Amazon to stream your music?

Sucks, but if no data loss occurred, so what? Much better than the whole microsoft disatster.

Quote:
Google is another amateur. They DONT WANT to pay anything. Their latest discussion with the labels: Google is only going to store the first 500 tracks of music on their cloud for free. If you want more, you have to pay. Google is not paying, you are paying.

500 songs around 5MB each, ~2.5GB of storage for free, this is bad why? Paying is now evil, why?
post #22 of 25
Only one person is that irrational in thought. Only one person could achieve that level of mastery in Teckstudian logic.
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post #23 of 25
Quote:
Originally Posted by samlogo View Post

Apple has arrived late to the music cloud service business. I am already using the best cloud service and I have it on my homepage. I listen to my music anywhere I go.

As we all know, being first does not necessarily mean best.

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post #24 of 25
Quote:
Originally Posted by apple-ecosystems View Post

If such a sytem of direct artists submission is created successffully, the Apple Ecosystems for music and mass media may become less dependent on record labels. Apple becomes the de facto "record label" for independent artists and smaller artists collaboratives.

Apple already does exactly what you are talking about: http://www.apple.com/itunes/content-providers/

They do have some minimum volume requirements for music, so unless you are a really popular indie artist, you should probably work through one of the many aggregators that Apple works with.
post #25 of 25
Quote:
Originally Posted by Dick Applebaum View Post

It may be difficult, but not impossible, to offer an Indie portal as well as a Label portal.

I believe that Apple is best suited to do this and the have the chutzpah to carry it off.

Apple is already creaking under the weight of the App store and having do deal with tens of thousands of individual developers. As I pointed out to Mr. Ecosystems, they already work with aggregators for lower volume artists - I don't see them changing that model any time soon.
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