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Apple's iCloud free at first, then $25 a year, sources say

post #1 of 44
Thread Starter 
Music industry insiders allege that Apple's forthcoming iCloud service will have an initial free period for iTunes Music Store customers, but the company plans to eventually charge a $25 a year subscription fee.

The Los Angeles Times confirmed on Thursday earlier reports that Apple had finalized contracts with the last of the major music labels, according to sources familiar with the negotiations.

"The service initially will be offered for a free period to people who buy music from Apple's iTunes digital download store," the report read. "The company plans to eventually charge a subscription fee, about $25 a year, for the service."

It is unclear, though, whether the report refers to the cost of the whole iCloud service or just the streaming music feature. By comparison, MobileMe, Apple's current online storage and sharing solution, costs $99 a year.

In addition to charging a subscription fee, "Apple would also sell advertising around its iCloud service," the report noted, without providing details on why Apple would both charge for the service and sell advertising. Sources also indicated that Apple "envisions the service to be used for movies, TV shows and other digital content sold through iTunes."

Sources told AppleInsider on Wednesday that Apple could offer general iCloud features free to Mac users who make the upgrade to Mac OS X Lion, though a music streaming service would likely come with a price tag. Music industry executives have previously suggested that Apple's cloud-based music service could be free at first, but would eventually cost money.

People knowledgeable with the terms of Apple's agreements with the music labels claim 70 percent of the revenue from iCloud's music service will go to the labels and 12 percent will go to the publishers, leaving Apple with 18 percent, according to Thursday's report.

However, those numbers contradict a report from CNet earlier on Thursday that alleged Apple would keep 30 percent of revenue and share 58 percent with the labels and 12 percent with publishers. That report also cited sources claiming Apple's streaming music service won't be available on Monday "but will be offered soon," though it will reportedly store only music purchased from the iTunes.

Apple is set to unveil the service next Monday at the Worldwide Developers Conference keynote in San Francisco, alongside a preview of Mac OS X 10.7 Lion and the introduction of iOS 5. Banners posted in preparation for the event have revealed the iCloud icon.



The Cupertino, Calif., company is said to have pushed up the release of the iCloud service because rivals Amazon and Google have launched their own cloud-based music storage solutions, though Apple differs from its competitors in that it renegotiated licenses from rights holders. Amazon has reportedly faced a backlash from record labels for initiating its Cloud Drive online music streaming service without new licenses.
post #2 of 44
I wouldn't be surprised if it's 70-12-18.

This is another example where Apple's cash hoard gives it competitive advantage (the other being ability to pay up front for long-term supplier contracts). Given that music content is a low-margin business for Apple, but helps it sell its hardware, it will be a huge win.
post #3 of 44
Free for current .Me subscribers? I hope so.
post #4 of 44
Unless you can put all your music in it, no matter where you got it, it's useless. If you have data plans that are capped, even worse. How can you stream with a cap?
post #5 of 44
Free with ads and €25 a year without and you are making some sense. Anything else and Apple can kiss me arse. Anything else and the whole thing sucks.

iOS 5 + iCloud better give iPhone, iPod touch and iPad ball and chain-less local out-of-the-box activation. Then I can recommend an iPad to my both Aunts, but not before that.
Citing unnamed sources with limited but direct knowledge of the rumoured device - Comedy Insider (Feb 2014)
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Citing unnamed sources with limited but direct knowledge of the rumoured device - Comedy Insider (Feb 2014)
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post #6 of 44
I can't wait until Monday so all the rumors are put to rest...

Crap... then the analysis begins... \
post #7 of 44
"without providing details on why Apple would both charge for the service and sell advertising"

Hey, I pay for movies and still get ads. I pay to go to the ballgame and still get ads. I pay for magazines and still get ads. I pay for cable and still get ads.

Didn't you get the memo?

Quote:
Originally Posted by ghostface147 View Post

Unless you can put all your music in it, no matter where you got it, it's useless.

That's my problem with it, too. Well, that and not really knowing what the hell it is.
post #8 of 44
Where does this report say you can't get all your recognised music on iCloud. It doesn't.

The "security". They already have your credit card. They know what you bought in iTunes. They know what else you have in Genius. What new security issue?

As for the utility - if you don't get it you don't get the iPhone or iPad.
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I wanted dsadsa bit it was taken.
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post #9 of 44
Quote:
Originally Posted by Michael Scrip View Post

I can't wait until Monday so all the rumors are put to rest...

Crap... then the analysis begins... \

Yes, the usual suspects are already panning it here. See a post or two above. The whining and declarations of D.O.A.! will ensue like the sun rises in the east.
post #10 of 44
$25 is a much more reasonable price, however I would go with a freemeum model. 2 Gigs of cloud storage for free with every iDevice purchase. $25 will get you 50GB whether you have an iDevice or not. That creates incentive to buy iDevices (or upgrade OS X could be a way to get 2GB as well) but also gives an option to those who want more space to buy it.
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--SHEFFmachine out
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post #11 of 44
Quote:
Originally Posted by magicj View Post

$0.00 - $25.00/year starting to get closer to the actual value of the service, IMHO, than the $100.00/year of MobileMe. Although even at $0.00 I won't be using it due to it's security issues and lack of utility.

Since details have not been announced, what "security issues" and what " lack of utility" do you write about Mr. FUD?
post #12 of 44
Quote:
Originally Posted by anantksundaram View Post

I wouldn't be surprised if it's 70-12-18.

This is another example where Apple's cash hoard gives it competitive advantage (the other being ability to pay up front for long-term supplier contracts). Given that music content is a low-margin business for Apple, but helps it sell its hardware, it will be a huge win.

How much do you suppose it cost them? $40 billion? $50 billion?
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Please don't be insane.
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post #13 of 44
I'm looking forward to seeing the final costs associated with this service.

It would be very nice if over-the-air syncing of basic stuff like emails and contacts formed a complementary service for those with an iPhone/iPad. The data involved would be negligible compared to something like streaming video content.

Wishful thinking probably.
post #14 of 44
Quote:
Originally Posted by Michael Scrip View Post

Crap... then the analysis begins... \

No, the whining.....
post #15 of 44
Quote:
Originally Posted by lkrupp View Post

Yes, the usual suspects are already panning it here. See a post or two above. The whining and declarations of D.O.A.! will ensue like the sun rises in the east.

I see that you got in before I did!
post #16 of 44
Quote:
Originally Posted by Dr Millmoss View Post

How much do you suppose it cost them? $40 billion? $50 billion?

No, more like the $2B - $3B check Apple signed to build the service, plus the recurring operating expenses. The latter will probably be paid for from the 18%).

(I know where you're going with this question, but I don't wish to go there).
post #17 of 44
Okay, so I have a question (sorry if it's been asked and answered previously - I am just too lazy to flip through 70+ threads to see if it's already been asked) - one that has bothered me since the reported advent of iCloud, and now rings even more true given a recent report stating something to the effect that iCloud will store all "purchased" music (and whatever else Apple offers to host).

Based on that interesting little revelation, what do iTunes and iCloud do with music or video currently in my library that was not purchased through iTunes (i.e., Amazon, etc)? Do I maintain two libraries but only have access to onevia iCloud?

I am also a little concerned about the integrity of my existing library given recent faux pax's where data was lost as a result of various upgrades - I do NOT want to lose a large percentage of an 80K+ library, ya know?
dano
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dano
if it is to be, it is up to me...
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post #18 of 44
Quote:
Originally Posted by ghostface147 View Post

Unless you can put all your music in it, no matter where you got it, it's useless. If you have data plans that are capped, even worse. How can you stream with a cap?

I agree with your first point. I don't believe for a second that it will only support music bought through ITunes - that would be a massive fail. Too much music in too many people's iTunes libraries were put there from music previously owned. Here's one way they might get around fears of pirated content being suddenly "blessed" when found in your library - perhaps they'll require that anything that will go to/come from the cloud will have to have been ripped through iTunes, thus proving that you at least had a physical CD at some point. Not foolproof, but could weed out music that's just been shared and passed around. I'm hoping to see some sort of much-higher quality music coming down from the cloud - instead of 256k kbit AAC's, how about an option for Apple Lossless, or other variations of better quality than what we now get from iTunes? That would be awesome.

As for the caps that all the carriers are imposing, that's another beast altogether. It will be fun to watch all this play out.
post #19 of 44
Quote:
Originally Posted by AppleInsider View Post

Music industry insiders allege that Apple's forthcoming iCloud service will have an initial free period for iTunes Music Store customers, but the company plans to eventually charge a $25 a year subscription fee.

[...]

However, those numbers contradict a report from CNet earlier on Thursday that alleged Apple would keep 30 percent of revenue and share 58 percent with the labels and 12 percent with publishers.

allege, as in "done something wrong or illegal"?
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"Personally, I would like nothing more than to thoroughly proof each and every word of my articles before posting. But I can't."

appleinsider's mike campbell, august 15, 2013
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post #20 of 44
Two things have always stopped me using MobileMe.

$99 a year ad not being able to use your own @.com (I don't want to forward, it all gets messy)

At 25 a year I'd use it for sync, but I doubt Apple will let you use your own domain for email which will be disappointing.

audio and all, as someone else said. Cap data and drop outs make that all seem useless. If you can't upload your library that's pretty useless. If your purchases on iTunes are no longer susceptible to being "lost" with no recourse to get them back, that's excellent.

Soon we shall know.
you only have freedom in choice when you know you have no choice
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you only have freedom in choice when you know you have no choice
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post #21 of 44
Just WAIT AFTER MONDAY'S ANNOUNCEMENT! Then we all can bitch or praise or whatever about iCloud.
post #22 of 44
Quote:
Originally Posted by magicj View Post

$0.00 - $25.00/year starting to get closer to the actual value of the service, IMHO, than the $100.00/year of MobileMe. Although even at $0.00 I won't be using it due to it's security issues and lack of utility.

According to my sources:

The $25 a year is just for the music streaming. It is actually part of iCloud (which is MobileMe 2.0) but you can subscribe to just that tier of the service. Or pay for the whole thing, which has been rewritten from the bottom up to improve performance. It has all the stuff that mobile me has now and over time more features will be added.

The free service is restricted to the tracks you bought from itunes as a kind of trial. If you want anything else you have to pay the fee which is used to pay broadcast fees to the labels for the tracks since they didn't get their cut from an itunes sale.

A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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post #23 of 44
Quote:
Originally Posted by ghostface147 View Post

If you have data plans that are capped, even worse. How can you stream with a cap?

The first time you stream a song the file is cached so all subsequent times you listen to the song it is simply playing from your device rather than streaming.
post #24 of 44
I'm not going to say too much about this right now, because nobody knows any details yet.

I will admit that I'm not too excited about it though. Maybe that's a good thing, and I can be surprised come monday if it turns out to be something different than I'm expecting. Streaming music from a damn cloud ? bleh ...........Last I checked, ipods and iphones can hold plenty of music on them and they're pretty small and you can bring them anywhere.

And if it's only going to work with stuff that's bought from the itunes store, then that's two thumbs down from me. I wouldn't even bother to sign up, even if it's free, if that's the case. I do hope that I am wrong though. We'll see........
post #25 of 44
Quote:
Originally Posted by charlituna View Post

According to my sources:

The $25 a year is just for the music streaming. It is actually part of iCloud (which is MobileMe 2.0) but you can subscribe to just that tier of the service. Or pay for the whole thing, which has been rewritten from the bottom up to improve performance. It has all the stuff that mobile me has now and over time more features will be added.

The free service is restricted to the tracks you bought from itunes as a kind of trial. If you want anything else you have to pay the fee which is used to pay broadcast fees to the labels for the tracks since they didn't get their cut from an itunes sale.

Not sure what your sources are, but that sounds pretty spot-on to me.
post #26 of 44
Quote:
Originally Posted by anantksundaram View Post

No, more like the $2B - $3B check Apple signed to build the service, plus the recurring operating expenses. The latter will probably be paid for from the 18%).

(I know where you're going with this question, but I don't wish to go there).

Sorry, but you already did go there. Would it help if I apologized for noticing?

Reality: Apple didn't need a penny of their cash reserves for this. At most it would have consumed 5% of the current cash reserve, but at worst the entire operation could easily be funded out of a couple of weeks of cash flow. I suppose the immensity of Apple's cash reserves and cash flow may not be apparent to everyone. Perhaps now it is a little more apparent.
Please don't be insane.
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post #27 of 44
Only fools will come up with this thinking

Quote:
The Cupertino, Calif., company is said to have pushed up the release of the iCloud service because rivals Amazon and Google have launched their own cloud-based music storage solutions

Apple work on things for year and get them ready. It's Amazon and Google who rushed to create one because they heard Apple was working on one. And that's why they're half baked.
post #28 of 44
iPad 3.
post #29 of 44
Quote:
Originally Posted by alienzed View Post

iPad 3.

On monday?

Yeah, you're right. I heard that it's going to come with a self cleaning, super duper, 256 bit retina display that is fingerprint proof. Also included free of charge in the box is a special tin foil hat with an Apple logo on it.
post #30 of 44
Quote:
Originally Posted by Apple ][ View Post

On monday?

special tin foil hat with an Apple logo on it.

I'd sport one
post #31 of 44
Unrelated: Do not want to know how much money I have spent in total at the iTunes store over the years.

Loyal customers should get a little freebie love though.
post #32 of 44
Quote:
Originally Posted by charlituna View Post

The free service is restricted to the tracks you bought from itunes as a kind of trial. If you want anything else you have to pay the fee which is used to pay broadcast fees to the labels for the tracks since they didn't get their cut from an itunes sale.

Didn't get their cut??? They got their cut from the CD sale.
post #33 of 44
Quote:
Originally Posted by Orlando View Post

Didn't get their cut??? They got their cut from the CD sale.

You are missing the "label" speak. Meaning they (the labels) didn't get their cut of the "digital" sale through iTunes.
post #34 of 44
Quote:
Originally Posted by stonefingers View Post

Okay, so I have a question (sorry if it's been asked and answered previously - I am just too lazy to flip through 70+ threads to see if it's already been asked) - one that has bothered me since the reported advent of iCloud, and now rings even more true given a recent report stating something to the effect that iCloud will store all "purchased" music (and whatever else Apple offers to host).

Based on that interesting little revelation, what do iTunes and iCloud do with music or video currently in my library that was not purchased through iTunes (i.e., Amazon, etc)? Do I maintain two libraries but only have access to onevia iCloud?

I am also a little concerned about the integrity of my existing library given recent faux pax's where data was lost as a result of various upgrades - I do NOT want to lose a large percentage of an 80K+ library, ya know?

Maybe you and all others should wait until Apple ACTUALLY and formally announces the service with details next week before asking questions.

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post #35 of 44
Quote:
Originally Posted by alienzed View Post

iPad 3.

Mac mid-tower?
post #36 of 44
Quote:
Originally Posted by magicj View Post

Although even at $0.00 I won't be using it due to it's security issues and lack of utility.

Quote:
Originally Posted by Chris_CA View Post

Since details have not been announced, what "security issues" and what " lack of utility" do you write about Mr. FUD?

I have to agree w/Chris. We don't even know what the service is going to be, let alone how it will be delivered, so what kind of security and utility are you talking about. I'm generally on board with your privacy concerns (because I'm on board with ALL of EVERYONE'S privacy concerns), but I have no idea what you're talking about here.

FWIW, I'm not personally interested in the slightest. My iPodTouch has more than enough room for all the high-quality music I care to listen to. Always with me, no data xfer caps, no streaming delays, no searching for WiFi. It just works. And I don't do "cloud" stuff in general, so it sounds pretty Meh to me, but I suspect there will be some surprising aspect we'll find out on Monday.
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post #37 of 44
Quote:
Originally Posted by cy_starkman View Post

Two things have always stopped me using MobileMe.

$99 a year ad not being able to use your own @.com (I don't want to forward, it all gets messy)

At 25 a year I'd use it for sync, but I doubt Apple will let you use your own domain for email which will be disappointing.

audio and all, as someone else said. Cap data and drop outs make that all seem useless. If you can't upload your library that's pretty useless. If your purchases on iTunes are no longer susceptible to being "lost" with no recourse to get them back, that's excellent.

Soon we shall know.

I assume this is the forwarding you refer to?
https://discussions.apple.com/thread...3449&tstart=90

Not messy at all IMO, but you do have go through gmail and I agree in principle that MobileMe should handle this internally. I am using this method under the assumption that it will be possible through MobileMe in the future. I really dislike any of my data with google.

As for the $99 cost, I think it depends on how you use the service. If it's for syncing contacts, cals, bookmarks, etc, yeah, maybe it's pricey. But if you add the 20 gigs data, push email, and website hosting, it's a pretty great deal in my book because it all works so seamlessly and you actually get a lot for your money. Plus, nobody pays $99. The going rate on amazon and eBay has been like $55 for years now.

But this all moot now. We await the news of the revamping. I certainly hope it's not just music streaming because that is of the least interest to me.
post #38 of 44
$25 (which will probably translate to £25) sounds reasonable to me. Any more and your then moving to comparisons which subscription music services. But it has to be able to store you're whole music collection.

For it to work (for me anyway) this has to be a service that lets you download your music to your phone rather than stream, to solve the issue of not being able to store your entire collection on your phone to begin with. Streaming services arn't that great as it uses more power and if your in a slow data connection area they just don't work.
post #39 of 44
Quote:
Originally Posted by ireland View Post

ios 5 + icloud better give iphone, ipod touch and ipad ball and chain-less local out-of-the-box activation.

+1 .
post #40 of 44
While most people are focusing on the usefulness of the music streaming aspect of iCloud, I have a different take. If video is included in the service, I imagine iCloud could eventually be aimed at either replacing or complementing Netflix streaming.

I would be much, much more willing to purchase TV shows and movies from iTunes (something I rarely do today) if I was given the capability to stream that content to any of my devices from anyplace that had an internet connection. For that capability, I'd say $25 a year is a steal. Combine it with a Netflix account, and virtually any movie or TV show I want to watch will be available to me at all times.
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