Apple has deals with record labels for cloud music service

Jun 03, 2011 By Alex Pham, Los Angeles Times
Apple logo

Apple Inc. sewed up contracts with the four major record labels by Thursday for a cloud music service, with agreements from music publishers to follow Friday, according to sources familiar with the negotiations.

The service, dubbed iCloud, initially will be offered for a free period to people who buy music from Apple's iTunes digital download store, allowing users to upload their music to Apple's computers, where they can then be played from a Web browser or Internet-connected Apple device.

The company plans to eventually charge a subscription fee, about $25 a year, for the service. Apple would also sell advertising around its iCloud service.

The agreements, finalized this week, call for Apple to share 70 percent of the revenue from iCloud's with record labels, as well as 12 percent with music publishers holding the songwriting rights. Apple is expected to keep the remaining 18 percent, said people knowledgeable with the terms.

Music companies that have signed on to iCloud include , , and . Representatives from the four companies could not be immediately reached for comment.

Although the service is initially focused on allowing consumers to store their music on Apple's servers, the Cupertino, Calif., technology company ultimately envisions expanding the service to movies, TV shows and other digital content sold through iTunes, said a person knowledgeable of the company's plans.

Apple, whose iTunes music store is the dominant purveyor of music downloads with 75 percent to 85 percent of the market, has been carefully monitoring moves by rival Amazon.com as well as newcomers to the digital music space, including Google and, in Europe, Spotify.

Amazon pounced first in March when it launched a music "locker" service, dubbed Amazon Cloud Player, that lets users upload their music to Amazon's computers and listen to their songs from any browser. Google followed suit in May with its Music Beta service.

Explore further: Social media sackings risk stifling journalistic expression

0 shares

Related Stories

Amazon puts music in the 'cloud' (Update)

Mar 29, 2011

Beating Apple and Google to the punch, Amazon unveiled a service on Tuesday that allows users to store their digital music online and play it on a computer or an Android device.

Google to launch online music service: report

May 10, 2011

Internet giant Google could launch an online music service as early as Tuesday to rival Amazon's "cloud" service, which allows users to store digital music online, the Wall Street Journal reported.

Apple nears music deal with labels

May 21, 2011

Apple Inc. is close to securing deals with all four major recording companies on a music service that will allow users to stream songs stored on remote computer servers, presumably to an array of portable ...

Google unveils cloud-based music service

May 10, 2011

Google Inc. unveiled its long-planned music service Tuesday, but it will likely need deals with the recording industry to reach its full potential.

Recommended for you

ICANN chief stepping down in early 2016

May 21, 2015

The head of the group that oversees all Internet addresses will step down early next year, after a plan to end US oversight of the key nonprofit organization.

How alternative currencies could catch on and cash in

May 21, 2015

Alternatives to cash, like Bitcoin and Uber, may never replace the coins in our pockets or paper bills in our wallets, but they are creating significant social and economic impacts, and with some design adjustments, ...

Spotify introduces video, radio service

May 20, 2015

While saying that it is still a music company at heart, Spotify says it is expanding its lineup to include podcasts, news radio and video streaming.

User comments : 0

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.