Apple’s stairway to iCloud

In the last decade, Apple made the 99-cent download the standard unit of music sales. Now, Apple is reportedly poised to try a second transformation, enticing music fans to store songs online — “in the cloud” — instead of on a hard drive. If the company’s iCloud helps persuade the masses to embrace cloud-based services, that could help reverse more than a decade of sliding music sales. That’s a big “if,” however, and much depends on the labels’ willingness to change.

The shift from physical CDs to digital files has been a mixed blessing for the music industry, opening the door to rampant online piracy as well as promising new business models. The latter include subscription services that, for a flat monthly fee of $5 to $10, give consumers unlimited access to an online library of songs that they can play but cannot keep. Some of the biggest names in technology, including Microsoft, Yahoo and AOL, have tried in vain to popularize music subscriptions, yet new efforts keep emerging.

Apple’s forthcoming iCloud, like the online storage services recently launched by Google and Amazon, is a more modest step. According to press reports, iCloud will invite users to move their music collections from their home computers to servers on the Net (along with other valuable data, such as photos and digital videos). The point is to make your entire collection available wherever you go, as long as you have an iPhone or other device that can connect to the iCloud service. There would be no more need to transfer files onto devices; they could be streamed via the Net.

By making music available in more places and on more devices, such services make it more valuable. They also encourage people to think of music as something they access, rather than something they collect and carry around with them. That’s an important step toward embracing a monthly subscription service that provides access not just to the tracks you’ve bought, but to millions of other recordings.

Granted, Apple Chief Executive Steve Jobs is no fan of subscription music services. Nor is it clear that the major labels and music publishers are willing to let companies like Apple offer cloud-based music lockers without debilitating restrictions, such as a ban on tracks that weren’t bought from an online store. Such limitations may be intended to deter piracy, but they also could render cloud services unappealing to the typical consumer.

The labels’ track record of handicapping new services with burdensome anti-piracy provisions and huge up-front payments isn’t encouraging. But Apple has a track record of making new music services work. With smart devices and broadband connections proliferating, perhaps Apple’s push into the cloud will help the industry capitalize, finally, on the opportunities inherent in the shift to digital.