Steve Jobs announced Apple’s new cloud-based service last week—fully equipped, of course, with an industry-rattling curveball. iCloud itself holds no real surprises; it’s basically a free way to share new music you purchase with up to ten different devices. The real kicker is that Apple is also launching a complimentary service, for $24.99 a year, called iTunes Match. This allows iTunes to scan your library, ID your songs and (assuming the song exists in iTunes) give you access to their legit version on the iCloud. On the surface, iTunes Match is just a convenient way to quickly take your library to the cloud without having to upload it—which could take days. What’s ruffling everyone’s feathers is that Apple is letting people convert their bootlegged songs to legit ones for what is essentially $2 a month. As you might expect, everyone (and their mother) has an opinion about how this will affect the industry.
Let’s start with the bad. Many people think that Apple is just offering a “parley” with the music pirates and essentially finding a way to profit off of piracy. The stance of “some payment is better than none” is nothing more than a weak compromise. But that’s far from the biggest concern. With the industry moving closer and closer to subscription services, some people fear that Match will kill the future before it has a chance to happen. The big four labels, who are reportedly being paid about $150 million up front by Apple (all together), have taken the quick cash without any incentive to pay their artists in the future. As Bob Lefsetz says, “[I]t’s like Nintendo being paid a bunch of money to never develop the Wii. It’s like Electronic Arts being paid to never develop mobile games. It’s a denial of the future. Who in the hell is going to buy a music subscription for even $3 a month when for $25 a year you can have everything you own, even stole, at your fingertips via iCloud?” While Lefsetz’s theory may be a bit extreme, he does bring up a good point.
On the other end of the spectrum, however, there are those who see Job’s announcement in a more positive light. The most obvious upside is that the industry will recoup some, if only a fraction, of the money it’s lost over the years to illegal downloading. As pointed out earlier, it will probably only benefit the labels and not the artists, but it’s still something. According to the industry executives that Fast Company spoke with, though, the real value is in the data; legitimizing illegal libraries will give them firsthand knowledge of what people are listening to. This crucial information has been almost non-existent since piracy became popular. There’s also the theory that suggests the exact opposite of Lefsetz’s: that iTunes Match will actually help prepare the world for music subscription services. The logic behind it is that Match will get people back into the habit of spending money on music. After years of illegal downloading, people have come to expect music to be free—Match, supposedly, will make consumers associate costs with the product once again and ease the transition into a world of subscriptions.
Steady as a rock...
Like anything else, there’s at least three sides to Apple’s upcoming release. What do you think? Is it good for the industry, the end of life as we know it or will it just get sued into oblivion by the record labels like My.Mp3.com? Share your thoughts below!