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iCloud: Why Apple must go big in the sky

Apple

Apple is going to reveal an Internet-based media and storage — aka "cloud" — strategy next Monday, and it better be one mother of a program.  Not only does the company have the audacity to call their network "iCloud," but the competition is already hot and getting hotter. 

Google and Amazon are out in front with their streamed bring-your-own-music services. Apple not only must match their offerings, but one-up them with a bigger, better system, one that caters to both phones and tablets. The stakes may well be the future of its mobile platform.

Cloudy term
The term "cloud" is overused to the point of non-meaning. It's frustrating. I've heard nerds say "'Cloud' is what idiots refer to as the Internet." I wouldn't go that far: Cloud is best defined as "anywhere" access to users' own media, documents and apps, with increasing emphasis on mobile devices. That is, while we've long had services that streamed music and movies over the Internet, and even occasionally backed up files to drives out on the Internet, the idea that it can even happen when we're walking down the street is fairly new.

So while marketers can (and do) use the term "cloud" to refer to almost anything, from banking to Facebook, we're talking about media and file storage, and — at the moment — we're talking about three companies: Amazon, Google and Apple.

The combatants enter
There are two traits that make a company competitive in this corner of cloud computing: a strong mobile platform and a strong retail presence. Google has the No. 1 most widespread mobile OS in the world, but it's not much of a retailer. Nevertheless, in the development of YouTube and other media services, it has gained experience in media distribution and — more importantly — rights management.

Two weeks ago, it launched a beta of its cloud-based Music service, which allows participants to upload up to 20,000 songs to stream anywhere. That's more than my entire music collection; probably more than 99 percent of Americans' entire music collections. Best of all, in the grand tradition of Google, it's totally free.

Amazon is a retailer which has lately come to the mobile game, by way of its successful e-reader. It's not building its own mobile OS — in fact, it's all but confirmed to use Android for its coming wave of full-color readers — but it's threatening Google already with its ambitious Android app store.

On top of that, just a month or so ago, Amazon launched the Cloud Music Player, which lets people upload their own songs. Amazon handed out 5GB (room for up to 700 songs) free to everybody, but purchasing a single album, including something cheap from the bargain bin, granted the user 20GB for a year at no extra charge. 

Microsoft talks a big cloud game, but it's not yet set to compete in this particular arena, as its new mobile platform hasn't yet taken root, and its media distribution is inherently tied to the success of its mobile devices, unlike Amazon. (Msnbc.com is a joint venture of Microsoft and NBC Universal.)

Bare knuckles vs. kid gloves
It's a fact that Google and Amazon play rougher than Apple when it comes to dealing with Hollywood. Google is notorious for shooting first, asking for forgiveness later, and Amazon tends to use its leverage as a major retailer of CDs and DVDs to do some surprising things with digital media pricing, including offering cheaper albums and TV episodes, and launching its cloud music service without the express written consent of the music industry's legal departments.

Apple, on the other hand, has been working on its iCloud service for years, at least as far back as late 2009, when it bought Lala, a business with strong technology and rights deals in the streaming music area. But it's apparently taken a long time because, unlike Google and Amazon, Apple wanted to have explicit deals with all of the major music labels before launch. This may ensure a smoother take-off, but it may also mean fees and restrictions on storing music you already "own."

If you have trouble understanding why Apple would play so nice with the old copyright holders, it's because it's in their DNA. Don't forget that Apple's CEO used to own Pixar, and sits on the board of Disney.

Moving beyond music
Speaking of Disney, the real tricky part of cloud evolution is what happens after music. Music files are fairly small and now sell without digital rights management, so they're very easy to move around and play on any device. If a cloud service allowed you to upload and stream home videos and other personal content, the door would be open, and soon ripped DVDs and pirated movies could make their way in.

For the movie industry, the good news is, the cost of movie storage alone is prohibitive, and not-so-private services like Google's YouTube serve personal video needs fairly well. Video is huge, and comes wrapped tightly in the latest content security. That's why the Netflix streamed model has been so popular: We don't want to carry video around, we just want to have access to it. On that token, Apple may very well offer a pay-per-use streamed video service to iPhones and iPads, but it might be limited to Wi-Fi, and likely won't involve personal videos.

So what does the cloud agenda contain, beyond music and video? Apps are easy — Google, Microsoft and others already have cloud apps, and Google's whole Chrome platform is built around the idea of Web-based software. Personal file storage and back-up is old hat — who doesn't offer some kind of "locker" for your stuff?

Sadly, the answer may not come from tech innovators but from the utilities that provide Internet access. The more that shifts to the cloud, the more reliance there must be on Internet connectivity — at home and out in the woods. That's where Verizon, Comcast and AT&T have more to say than Apple, Google and Amazon. But innovation has a way of sneaking past the old guard.

So on Monday, once Steve Jobs is done talking about streaming music from iCloud, pay attention to whatever else he says. It just might be the future. But if that's all he has to say — and if his version of streamed iTunes comes shackled with new fees and tight restrictions — Apple will stay in the middle of a fight that may well be won by one of its tough competitors.

More on Apple and the cloud from msnbc.com:

On Thursday, join Wilson at gadgetbox.msnbc.com for a live chat about "the cloud," in all its nebulous glory. In the meantime, you can catch up with him on Twitter at @wjrothman, or join our conversation on Facebook.