Seeing clouds on a sunny day. Photo (CC-BY) Kristine Paulus.

We’ll be watching Apple’s developer conference closely to try to understand the implications of a likely announcement of an Apple cloud music service for artists. While Google and Amazon are already testing those waters, Apple’s dominance of the software player (iTunes) and mobile players (iPod, iPhone) give it arguably greater weight.

We should know more after the official announcement, but early reports suggest independent labels (to say nothing of unsigned artists) may have reason for concern. I think it’ll make more sense to analyze this once some of the secrecy is lifted, but one group has already made a statement even before that announcement, indicating the level of scrutiny today’s keynote is likely to gather. The “fifth major,” the largest representative of independent labels, is already concerned about even the possibility of a cloud that would favor major labels:

In response to media speculation that independent labels are being offered a discriminatory licensing deal for the new iCloud service, Charles Caldas, CEO independents’ rights agency Merlin says:
“As the most experienced player in the digital music space, Apple should have the deepest understanding of the significant value that independents bring to their business. In light of this I would be very surprised and extremely disappointed if Apple were not going to ensure that independent rights holders are properly and fairly remunerated on the iCloud service.”
Merlin is unable to comment on any aspect of the negotiations, which given Apple’s position running the world’s longest-standing digital music service, with existing deals with the vast majority of the world’s right holders, are a matter between Apple and its licensees.

Merlin is a big player in this landscape, not just someone looking for attention on an Apple launch day. As they describe themselves: “Merlin, the virtual fifth major, represents the world’s most important set of independent music rights. Merlin seeks to ensure its members have effective access to new and emerging revenue streams and that their rights are appropriately valued and protected.”

I believe interested artists and music lovers may want to pay attention to a number of issues with cloud services from Apple and others:

  • Major/minor cadence. Will majors get better deals than minors, in licensing, exposure, compatibility, or other areas? The cloud could level the playing field in some of the ways digital music has generally, but we have yet to see if it’s a step forward, backwards, or sideways.
  • Licensing. How will a cloud service track plays? Who will it play for those plays?
  • Fidelity. With mobile networks under heavy bandwidth concerns, what will the quality of streams be? How easy will it be to sync a higher-quality file to a device, and what will the quality and format of that device be?
  • Ease of sync. Will there be new layers of DRM associated with the synced file?
  • Distribution. Will cloud services work with files you’ve purchased direct from artists (on services like Topspin and Bandcamp)? From independent stores (Beatport, Bleep, and the like)? From CDs (or vinyl) you’ve ripped? Or will they tend to favor the store from which you purchased those files (iTunes, Amazon)? (Google, for instance, syncs your entire iTunes library regardless.)
  • Interoperability. To put this bluntly, “does this mean I have to buy stuff from Apple just to make it work in the cloud”? See also proprietary chipsets in playback devices: Apple’s AirPlay for local wireless even requires a chip to authenticate the validity of the stream, which could be seen as a kind of wireless DRM.
  • The open Web. Looking at interoperability on a Web front, will we see open APIs for working with these services? I was contacted by a number of people who were disappointed when Google didn’t talk about adding an API to their cloud service – particularly since they unveiled it, as Apple is likely to do today, at a developer conference.

So there’s my checklist; if you have ideas of your own, feel free to add them in comments. Why be concerned about these issues? Ironically, many existing Web services have begun to address these questions, though sometimes with questionable legality.

Updated – I compared these questions against what we got. Apple deserves credit for making the design of the service efficient; the situation just remains complicated by multiple vendors and platforms, and a lack of Web interoperability in all of these services (compared to the level of innovation from Web-based startups).

How’d Apple’s Cloud Do? Four Questions Answered.

The sum total of the flexibility, fairness, and openness of these services could also have a significant impact on independent artists and labels, and the ability to support a diverse range of music. That’s not to say that, absent these factors, the effect will immediately be negative – only that they’re areas of interest.

TuneCore is promising snap reaction immediately after the keynote, which might provide a clue into how unsigned artists would get on the service; I hope to follow up with Merlin, as well.

More reading in advance of Apple’s keynote:
Apple’s iCloud Will Scan, But How Much Will It Match? [Digital Audio Insider]
Storms Ahead for “Cloud” Music? [Future of Music Coalition, speaking largely about concerns and disappointments with Amazon and Google]
Digital Music News has been dutifully covering Apple behind-the-scenes as they reportedly sign a number of major labels – and raising red flags that the service may favor those labels. Unfortunately, that site is down as I write this.

DMN is back up. Read, for instance:
Uh-Oh: iCloud Has All the Markings of Another Indie Shaft…

Merlin is part of the negotiations and are unhappy about how they’re being treated. But note that the issues I raise above go beyond just the licensing questions, to the issue of how music is distributed and consumed in generally. And that may prove to be bad news for “artists who aren’t Lady Gaga,” too.