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Eye Spy an iCloud

Written by Gregory Bartolomei
Edited by Daniel Kilkelly
Three days ago, Apple Inc’s icon Steve Jobs made his first public appearance since January of this year after leaving the public eye. Mr. Job’s appearance comes at a time when Apple normally announces an extension of its popular product the iPhone. However, Mr. Job’s did not announce a product extension for the iPhone. Instead he announced a product extension for the already market-dominating music service, iTunes.
This product extension, called iCloud, is not a grand new technology nor is it a bravo re-engineering of a current technology; it is a better version of what is already on the market which, as the name of the technology suggests, employs cloud computing. Cloud computing is the ability of the user to securely access data and software (logical computation resources) over a network, most commonly the internet. This picture is an excellent visualization of the many different things that are accessible via ‘The Cloud.’

But as we know, cloud computing isn’t new – Google, Amazon, Dropbox, Microsoft, and many other companies offer these services. Yet, as I learned in my Principles of Business class during my freshman year, you don’t have to always come up with a revolutionary idea to be successful; you just have to do that thing better than the other guy. So, that begs the question – what has Apple done better for its consumers with cloud computing?

And here is the answer – iCloud will make cloud computing a central part of its user’s daily interaction with the technology rather than have it be an additional service.

How will this be done? There are not any buttons – when you do something on your computer, that something is saved everywhere else.

Consider document management and the many hassles that it carries. Outside of the Cloud, redundant documents are generated, important spreadsheets are misplaced, and emails with key information are lost. Within the Cloud (or iCloud to be more specific) there will be the original copy of a document that updates all the linked locations in real time. This makes syncing your computer with your mobile devices at the end of the day something of the past. That will save users maybe half an hour each day as they try to find their cables to connect, remember their passwords, and remember which files to sync. In a world of instant communication – thirty minutes is a long time.

This one change in the user’s daily interaction is only the tip of the iceberg, only an improvement on what already exists, only an example of how iCloud is doing it better. From this point, Apple can develop new technologies due to the firm’s position at the cutting edge. So, before this seems like a tech-crazed article, let us explore the business plan behind iCloud, which will drive much of its success.

The services that iCloud will offer to the consumer are already available, but in a dispersed and disjointed manner. iCloud is offering them in a bundle and thus offering the value added of convenience to the consumer (one login opposed to multiple logins which will save the consumer time as well as the headaches associated with forgetting logins or passwords).

Additionally with this offering, Apple is directly taking business away from its competitors. For example, Google Docs and Dropbox provide file sharing and parallel working capacity but still require syncing. The iCloud will provide file sharing and parallel working capacity in a better way – no syncing required. The iCloud will also take the best parts of communication protocols like AIM, IMO.IM, Skype, and BlackBerry BBM and mould them into one flowing service. Photo sharing sites like Flicker and Photostream will see their features integrated with the iCloud.

However, the best aspect of the iCloud is that it will allow users to access all of their music from any device. Say someone had 100 Gigabytes of music and an iPod that can only hold 16 GB, with the iCloud that user can upload or download any song in their library to their iPod. Apple can do this because it has made deals with record labels for the rights to share the music.

Another integral feature of the iCloud package is a service called iTunes Match. Within iTunes Match, iCloud will scan the average consumer’s music library and upload all that music to the Cloud. Here is the catch; all of the music – even the pirated music – will be uploaded. Then, Apple will give 70% of its revenue to the record labels for the right to deliver the pirated music to the consumer. This arrangement will also prevent other firms from developing a music sharing platform similar to iTunes Match. While it has not yet been released, it would be logical to assume that the record labels are not going to give another company the rights to share their music. iTunes Match may be the reason why Google’s music service did not sign with many labels.

Thus, iCloud will be a success. The geeks and nerds will love it because it is an evolution of a technology and the business community will support it because it has sound commerce roots.

I for one, am glad that I am a geek nerd finance undergraduate.

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**Due to technical difficulties we recently had to switch domains and transfer all of our website content.  Please keep in mind that while we have been publishing articles for two years, the published dates shown may not reflect the initial publish date.

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