updated 12:45 am EDT, Thu June 2, 2011
Sterne Agee reinterates 'Buy' rating at news
Back in April, Swedish firm Xcerion changed the name of their cloud-storage service (and its website) from iCloud to CloudMe, with reports that Apple had bought the domain from the company for a rumored $4.5 million as part of the buildup to Monday's expected announcement of iCloud services. Today, the administrative records in the WHOIS database confirm that Apple has taken control of the name, even though it currently still redirects to Xcerion's CloudMe service.
Normally the company keeps such announcements under wraps until the formal introduction, but Apple surprised markets on Tuesday by pre-announcing that the Worldwide Developer's Conference (WWDC) keynote would feature CEO Steve Jobs, as well as bluntly defining the rumored iCloud as the company's "upcoming cloud services offering," along with the expected focus on iOS 5 and Mac OS X Lion.
Analyst Shaw Wu of Sterne Agee believes the unusual candor suggests that Apple will be "aggressive" in its entrance to the increasingly-crowded cloud-services market, and has advantages (such as rumored deals with music labels and potentially other content providers) that will give it a significant advantage over companies who have come to market with "media locker" services ahead of Apple, including Google and Amazon.
Other rumors have the iCloud service offering a range of options not available from competitors, including permission to substitute higher-quality copies of lower-bitrate songs stored by users (possibly regardless of source) and stream them to mobile devices, along with automatically backing up purchased songs without users having to first upload them from their own libraries. Such convenience may justify any fee Apple could charge for the service, if any -- rumors and speculation have swung back and forth on pricing, with the current wisdom being that some iCloud services may be offered for free (at least on a basic level) while others will cost -- though none of the details in such reports can be confirmed.
Wu and other analysts believe the combination of iOS 5, Mac OS X Lion and iCloud's offerings could strengthen Apple's position among digital media consumers and increase the "halo effect" of the devices back to Apple's iTunes stores. Computerworld quotes analyst Ezra Gottheil of Technology Business Research as saying that Apple has felt that MobileMe (in its various incarnations) was ahead of its time but under-delivered on value, and hope iCloud will show the benefits of lessons learned from over a decade of offering cloud-based storage and other internet services.
The iCloud service and other details of Apple's plans for iOS and Mac OS X will be unveiled beginning at 10 a.m. PT next Monday during the WWDC keynote. Share of Apple's stock jumped significantly after the pre-announcement press release, and have remained elevated -- reaching $352 earlier Wednesday before dropping slightly.