Apple’s iCloud Gets Bigger; Cost Comes Into Focus

Apple iCloud has added the Universal music label to its licensing agreement.

According to a report at CNET, Apple cut a deal with Universal Music Group to allow the record label's music to be bought and stored on the iCloud. With this deal, it would mean Apple has deals with the four biggest music labels: Universal, Warner Music Group Corp., Sony Corp.'s Music Entertainment and EMI Group.

Various media reports say the iCloud will provide a place for consumers to store streaming media, from any source and not just iTunes, that could subsequently be synced to any compatible device. The iCloud will officially be unveiled on the sixth of June at Apple's Worldwide Developers Conference in San Francisco.

With Universal in tow, Apple would get rights to such music acts as Lady Gaga, U2, and Kanye West. According to the report on CNET, Apple still has more deals to negotiate but the company considers the major legwork for its iCloud service done. In each agreement, reports indicate Apple will get a 30 percent cut of any revenue from iCloud's music service, and 12 percent with music publishers holding the songwriting rights.

Another report, from The Los Angeles Times, says the iCloud's pricing structure has come into focus. The iCloud will cost $25 per year, but it will be offered for free at first. If this is true, it would mean it would be significantly less costly than Amazon's cloud service.

Amazon set the industry standard when it released its cloud service, giving away 5 GB of free storage, which can go up to 20 GB with the purchase of one mp3 album. Beyond the 20 GB, storage can be bought in intervals of 50GB, 100GB, 200GB, 500GB, and 1,000GB, with each costing $1 per gigabye. Thus you get 1,000 GB for $1,000. Google, which also has its own music service, did not reveal its price.

Analysts, like stock researcher company Zachs.com, says Apple's offering will likely draw in more consumers than either Amazon's or Google's.

The dominance of Apple in digital media services is reflected in its 200 million+ iTunes accounts. We believe the iCloud improves Apple's ability to provide customers a wider range of music, strengthening its position versus major companies like Google Inc. and Amazon.com Inc. Both of these have a similar sort of a service but they do not have licensing deals with music companies, Zachs said in a note.

Representatives at Universal, Warner Music Group Corp., Sony Corp.'s Music Entertainment and EMI Group, nor Apple, could be reached for comment.

Follow Gabriel Perna on Twitter at @GabrielSPerna