Looking to start your own online music streaming service? You might want to head to the bank for a giant loan first. According to the New York Post, Apple may be on the hook for $150 million in advanced payments to the big four music companies to license their music for iCloud. That’s one hell of an incentive to get on board with the project.
The NY Post is saying that Apple’s managed to pay between $25 and $50 million dollars to each of the music companies just to get them on board with the project. It seems like the music companies may also be carrying the burden of the cost for the first few months, as Apple plans to initially offer up the service for free, but then eventually charge a whopping $25.00 per year for the service.
Just so I’m clear, that’s complete sarcasm. At $25.00 per year, I may never buy another track again. It’s going to be all streaming, all the time around the Macgasm office.
The expected fund split would work out that the labels would get 58 percent of the cut, while Apple would take their 30 percent, and publishers would be getting 12 percent.
As an aside, the $25.00 per year may only include the music streaming portion of the new iCloud. Currently Apple chargers $99.00 for MobileMe (Calendar, email, etc), but some do expect that the traditional MobileMe application could be free with the iCloud offering. We certainly hope it is at this point.
Article Via NY Post