Apple is late again to another dawning realm of digital distribution — but like before, it may well be poised to dominate
With the unveiling only hours away by Steve Jobs, the Johnny Appleseed of the digital age, Apple's new iCloud service has arrived.
Apple is late again to another dawning realm of digital distribution, chasing after the launch of music clouds behind Amazon and Google.
But as with MP3 players, smartphones and notepads, that may not matter.
The iPod, iPhone and iPad came to dominate their earlier competitors. So will Apple's iCloud turn go the same way and be the game-changer of digital leisure?
Among the details that have leaked is that the iCloud will host music and not yet accommodate movies or TV shows.
And nowhere is there more cheerleading going on than at the once digitally unfriendly music labels, which have granted Apple licensing rights for a reported $125 million advance.
The industry support provides iCloud with potent advantages over its unlicensed early rivals where reliability issues, particularly at Amazon, have troubled consumers. iCloud, they say, is easy to use.
Clouds are, essentially, massive third-party servers for storage and access of digital data, relocated from personal hard-drives.
Instead of moving music and movie files from device to device, cloud subscribers may stream their media from anywhere, anytime, on myriad connected devices.
At Amazon, for example, any music you buy at the online giant's marketplace is stored in the cloud for free, and space can be rented for the rest of your digital catalogue, the cost depending on how much digital storage space you need.
The business-to-business cloud market is much further developed, with such cloud heavyweights as Amazon, for example, hosting Netflix's paradigm-shifting streaming video service.
As for Apple, it already has a cloud starter-system in place with Apple TV, which syncs everything in a consumer's iTunes account for play on his or her home theater system.
Eventually, it is believed, clouds will replace hard drives for computer users, allowing unlimited space.
It's expected that when Jobs rallies himself briefly from an indefinite medical leave to introduce iCloud on Monday morning, the race will start anew.
The reported $125 million advance from Apple toward the industrywide music license, meanwhile, is crucial to the quick inroads that Apple’s envisions for the late-coming iCloud.
According to top record label executives, for example, Apple’s license will give iCloud the potential to facilitate a monumental — and enriching — peace treaty between the music industry and the vast numbers of illicit consumers.
After years of aggressive prosecution of music pirates by record labels, Apple can now effectively launder their ill-gotten tunes through iCloud.
By substituting a legal club with an olive branch, music executives are hoping iCloud can lure waves of rehabilitated music fans into the legitimate digital music economy with wide-open wallets.
“Music companies are taking a big step in allowing people to scan entire libraries into iCloud,” one of the industry’s senior-most digital executives told TheWrap. “We’re extending our hand. It’s a big statement in terms of being extremely consumer friendly. It’s saying, you have pirated copies, and we’re OK with that.
“It’s going to bring a legitimate distribution experience to a much broader group of people than those who currently purchase digital music,” he added.
And, of course, there's that revenue stream. Not only will music companies continue to collect 70 cents of every 99-cent download, they now are poised to reap 70 percent of the rumored $20 to $25 annual iCloud subscription fee.
Through the cloud model, the industry is “a step closer to a return to overall growth,” the executive declared.
Of course, look for Apple to craft iCloud’s functionality into the elegant brand-defining simplicity that have made hits out of all of Apple’s i-offerings.
From iPods to iPhones to iPads, perhaps no single vision of digital utility is more dominant than than Jobs' — it has been at the root of our collective online experience with music, video entertainment and personal interaction in the young century.
By comparison, Amazon and Google’s unlicensed first-generation clouds could seem starkly more cumbersome and manually intensive.
One thing missing — barring an 11th-hour breakthrough by Apple in Hollywood — will be rights for storing and streaming consumers’ video libraries of feature films and TV episodes.
Last week, Disney CEO Rober Iger publicly distanced his company from the cloud at AllThingsD, a high profile digital media conference. “Nope," Disney's top spokesperson reiterated when TheWrap asked if the company would participate in the iCloud unveiling.
Meanwhile Warner Brothers is working on its own vision of a cloud hosting consumers' existing movie libraries – much like Apple will do for existing music libraries – with the possibility of buying and storing new movies digitally.
It should be noted that Jobs is a major Disney shareholder — and Disney's participation was a major reason for the success of the launch of iTunes' movies and TV store.
Also notable, iCloud is launching ahead of another cloud-like formation known as “Ultraviolet,” which is expected by fall.
Developed by a sprawling consortium of 70 top entertainment, retail and technology brands, Ultraviolet is being positioned at diametrical odds with the fundamental makeup of technologically incompatible, walled-off clouds under construction by Apple, Google and Amazon.
Music executives expect that the ability to back up hard-drives will be iCloud’s major initial appeal.
Consumers would upload their existing media libraries to so-called digital “lockers” at Apple’s new $1 billion cloud farm in North Carolina.
The No. 1 reason for customer service calls in the digital music sphere is library-destroying computer crashes, say music executives, citing industry surveys.
“In this new world, you just boot or reboot,” says a digital music executive involved in the iCloud launch.
And though chat rooms are filled with worry about how iCloud might address streaming data caps set by internet service providers, the Apple brand goes a long way.
Digital media experts believe Jobs will turn the recent headlines about cloud reliability into a major selling point for iCloud.
Massive numbers of Lady Gaga fans highlighted Amazon's cloud shortcomings last week when they clogged it to a halt buying 99-cent digital promotional copies of Gaga's new album.
“The trusted brand thing is going to be very significant,” says an executive of a Big Four music company. “People expect that Apple will execute at a high level and really focus on security.”
Still, the ability to back up files — however necessary and appealing — can’t be the main appeal to Apple, one analyst insists, noting Apple’s 200 million secured credit accounts.
“Apple is trying to mine those 200 million accounts,” he declares. “To get them excited, iCloud has to be something more than backup capability. There’s a lot of guessing as to what this is going to be.”