Peter Kafka

Recent Posts by Peter Kafka

Cloud Wars! Amazon Cuts Prices to Counter an Apple Service That Hasn’t Launched Yet.

Amazon got its music service to the cloud first, then watched as Google and Apple followed. Now it’s tweaking its service with a price plan aimed directly at the iTunes Match service that Steve Jobs unveiled last month: Amazon is cutting its prices on music storage, and rolling out a version of the service that should work on Apple’s iPad.

Amazon is now offering unlimited storage space for cloud-based music, which consumers can upload to Amazon’s servers and then stream back to their PCs, for $20 a year.

Previously, Amazon had offered 5 gigabytes of storage for free, and another 15 gigs for a nominal fee, then charged in increasing increments for more storage. Amazon is describing the price cut as a “limited time offer.”

Apple, meanwhile, says it will charge $24.99 a year to store up 25,000 songs for its iTunes Match service when it launches in the fall. The big difference between the two services: Apple has deals with the music labels that offer a “scan and match” feature, so users don’t have to physically upload each one of their songs to its servers, which should make it much easier to use, at least initially.

No surprise at all to see Amazon respond to Apple’s move with a price cut, and I would expect Google to counter with similar pricing once its service moves out of beta. Jobs made a big point of underscoring Apple’s price advantage over Amazon and Google during his iTunes Match unveiling last month (see photo above). But that seemed like an odd talking point, because it was always going to be a short-lived lead.

And Amazon, at least, seems intent on matching Apple’s scan-and-match feature as well: Music sources tell me the company has been back at the negotiating table with the big music labels this summer to get the blessing for an Apple-like service.

It’s curious that Amazon still isn’t offering a version of its service that works on Apple’s iPod and iPhone.

I asked Amazon PR about plans for those devices and got this non-answer: “Cloud Drive and Cloud Player for the Web has been optimized for use on the iPad. At this time we have nothing to announce about availability on other iOS products, but we are always looking at ways to expand and offer customers more options for listening to their music anywhere.”

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