How Much Is Apple Paying Labels For iCloud Streaming Rights?

Posted by on June 3, 2011

As reported earlier this week, Apple will indeed unveil their own cloud music service, the iCloud, this Monday (June 6) at their Worldwide Developer’s Conference. And now it appears that they’ve finally secured deals with independent publishers and Universal Music (the last of the big four labels). However, it’s apparently going to cost Apple a pretty penny to get the iCloud off the ground.

According to The New York Post, Apple will reportedly pay between $100 million and $150 million in advance payments to the four major labels. That’s $25 million to $50 million per label. That’s a pretty high incentive, and one Google was originally unwilling to pay (though apparently might be willing to pay up despite releasing the Music Beta last month). The New York Post also claims that iCloud might start off as a free service for anyone who has purchased music via Apple’s iTunes store, but eventually could implement a $25 a year charge in the future.

So $100 million seems like a pretty steep price, but could in the end be a major pay off for Apple. The Amazon Cloud and Google’s Music Beta might be doing well for themselves without label support. However, Apple’s iTunes still remains one of the top music retailers and the labels’ backing will allow users to skip the pestering uploading process (a small but major time saving improvement). Thus, the label’s support will give Apple even more of an advantage in the cloud music battle.

We will have to wait until Monday to find out for sure what the iCloud will actually be like. Let the countdown continue.


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