Your iTunes Library Anywhere? An iPhone No-Brainer For Apple (AAPL)
There's no guarantee this will ever happen. But if it does, it'd be great news for consumers, whose portable music selection is currently limited by the relatively small hard drives in Apple's iPhone and iPod touch. And it's a no-brainer for Apple -- one more reason for someone to buy an iPhone instead of a competing phone.
Where could Apple run into trouble? Its carrier partners, which Apple relies on for distribution, would want to get something out of the service. Transferring music files over the air is a relatively high-bandwidth activity. Moreover, carriers are expecting to offer some sort of version of this themselves -- see Nokia's "Comes With Music" plan -- for a fee.
So if Apple could get consumers to pay extra for this -- say, another $5-$10 per month on top of their wireless plan or MobileMe subscription -- and split that somehow with the carrier, it's an easy win-win. If not -- Apple has a habit of leaving its carrier partners out of the value chain; see iPhone ringtones and app downloads -- the carriers aren't going to be thrilled.
But this would be a disaster for the music industry, which has high hopes to someday make a business selling music to mobile phone subscribers. The Apple plan would basically cut them out of that equation, and they don't have any leverage to get themselves back in the picture. As it is, the labels continue to lament the sad state of their mobile efforts: Warner Music Group again reported this week that its mobile business "remains soft" in the U.S., with ringtone sales flat and "lagging" expectations.
See Also:
The iPhone App Store Rogues Gallery
Steve Jobs: MobileMe "Not Up To Apple's Standards," Vows To Fix
AT&T's U.S. iPhone Exclusive Extended To 2010? Or Shortened From 2012?
1. Iphones will only get more storage
2. Online storage will only get cheaper.
Their opportunity to create and sell this service would appear to be short-lived. And it would be easy to copy.
Now I agree that Itunes belongs in the cloud. Having painfully switched PCs and having had my laptop bonk on multiple occasions, the way Itunes is set up is a pain. And Itunes is slow, especially when syncing, which it wants to do all the time. It should be a website for the same reason than email belongs online. All I want to do is access one version of my library everywhere.
So where does this fit in?
It shouldn't come to Iphone first, because the data rates are too expensive to make sense. So this offering makes sense on their PCs and if/when iphones get wifi. Then cloud-based Itunes makes sense. And keep in mind the number of Itunes installs on Windows machines - once they got access to an apple app store, that's millions of more potential customers.
So this starts looking like a Trojan horse and it starts looking like apple competes with Steam and Gametap and Salesforce.com all of a sudden.
Dan Frommer:
Right, since apple's totally closed off any way of actually doing what is the easiest most simple thing. If that's not stifling innovation, I don't know what is...
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