Music industry “stunned” by Amazon’s Cloud Drive

Amazon’s cloud-based streaming music service has sparked an angry reaction from music industry bosses who claim the service may be illegal.

Music industry

Amazon’s Cloud Drive – announced yesterday – allows customers to store songs on the company’s servers instead of their own hard drives and play the content through their web browser or Android phone.

Sony Music was upset by Amazon’s decision to launch the service without new licenses for music streaming, said spokeswoman Liz Young.

“We hope that they’ll reach a new license deal,” Young said, “but we’re keeping all of our legal options open.”

The next big race is locker services – that’s what consumers want

Amazon beat rivals Google and Apple into the market for such “music locker” services, which are intended to appeal to consumers frustrated by the complexities of storing their favourite songs at work, home and on their smartphones. Apple and Google are expected to launch similar services.

“Somewhat stunned”

Music labels were informed of the plans last week. Only later did Amazon address the issue of negotiating licenses, one source close to the discussions said.

That executive called the move “somewhat stunning” and noted that some within the media industry said the service might be illegal.

“I’ve never seen a company of their size make an announcement, launch a service and simultaneously say they’re trying to get licenses,” said the executive.

In 2007, EMI sued MP3tunes, which offered a similar service. In the US, at least, consumers are allowed to store music files on their own computers, but it is unclear whether they have that right when they use remote storage services offered by cloud computing.

Amazon has not said when it intends to make the service available in the UK, but British copyright law currently forbids format shifting, which could make a local launch complicated.

Amazon’s service is part of its plan to be a bigger player in the digital content business and reduce its reliance on the sales of CDs and books. “It doesn’t have leadership in digital formats,” said BGC Partners analyst Colin Gillis. “The next big race is locker services – that’s what consumers want.”

Gillis said he expected Google to introduce a remote music storage service in May and for Apple to follow suit in June.

Although Amazon’s service lets users listen to music from most computers or phones regardless of where they bought the song, it will not work on Apple’s iPhones or have an app on that company’s devices.

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