Amazon's New Cloud Player Presents a Direct Challenge for iTunes

To be a major macher in today's lucrative media-delivery game means having your hands in three places: (1) manufacturing devices that consumers use to store and showcase books, movies, and TV shows; (2) owning the online store where consumers purchase their media; and (3) having a branded app that allows consumers to view said media across multiple platforms. Call this trifecta of media distribution "The Full Apple," as the kids from Cupertino are the only ones who have successfully hit all three — though, number three may be slightly lacking in the mobile realm.

Fast on Apple's heels is Amazon who has a strong and growing hold on the tablet / eBook reader market with their expanding family of Kindle branded devices. Amazon also not only owns one of the most recognizable names in digital media storefronts (via both its a la carte and unlimited Amazon Prime services), it may now be taking a share the poly-gadget app market with its updated Cloud Player.

Launched a little over a year, Amazon's Cloud Player lets consumers listen to tunes stored on the company's Cloud Drive across multiple devices. Now, a recent update will place the Cloud Player in direct competition with iTunes.

Like Apple's iTunes Match, the Cloud Player now offers a scan-and-match service for all your music purchases. The company has secured licensing agreements across the music publishing world to build a library of millions of recordings, allowing the service to match any tracks on customers' computers including those ripped from CDs, purchased through iTunes, or acquired elsewhere. In addition to tracks purchased through Amazon, users can scan-and-match up to 250 tracks for free. Comparatively, iTunes Match requires a $24.99 yearly subscription to scan-and-match tracks not purchased through iTunes. For power listeners who want to upload all of their music (or 250,000 tracks max) they can upgrade to the Cloud Premium Player for $24.99/year.

The Cloud Player is available across the non-Kindle device spectrum, including through any Internet browser, Android devices, and even for iOS. Amazon also plans to launch the service on Roku and Sonos home entertainment systems. Compare this ubiquity to iTunes, which is only available on iOS in the mobile realm and can't be accessed through an Internet browser.

As you may have noticed, the Cloud Premium Player's $24.99 annual price tag is the same as Apple's iTunes Match service. Because of this we expect Apple to match Amazon's bid with a similar gratis offering of free tracks to scan and match to the iTunes cloud. As with Match, Cloud Player tracks are DRM-free, meaning you can download them onto any device, and like Match, any tracks will be automatically upgraded to high-quality 256kbps audio, even if they were purchased at a lower quality. (For example, tracks purchased on iTunes prior to April 2009 are likely less audiotastic.)

If that's not enough cloud war drama for you, we should also note that Apple just gave the OK for the free Amazon Instant Video app for the iPad (sorry, no iPhone or iPod Touch for now). The Instant Video app will make up for its boring name by giving Amazon Prime subscribers the power to watch content from their Amazon video library on their iPad. This is a bonus for families with multiple types of devices. (Note: The Instant Video app for the iPad will not allow users to buy or rent videos directly, as official iTunes rules dictate that Apple takes a bite out of any in-app media purchases, so you'll have to buy/rent/organize your content in the Amazon Cloud before watching it on your iPad.)

The good news (for everyone) is that when companies compete like this, consumers come out on top. Expect new salvos from both companies to be unveiled in the coming months, and don't be surprised to see Google and Microsoft jump in on the action. This battle for the cloud is far from over.