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Apple to open iCloud for 'free' before slapping $25 subs on service

Wrapped in ads, too

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Apple is reportedly planning to shepherd its existing iTunes subscribers into the company's upcoming iCloud service, by initially offering them to make the online pilgrimage at nada cost.

Down the line, however, the LA Times reports that users will be slapped with an annual subscription fee – said to be around $25 – to access the service.

The iCloud music storage system is also expected to be wrapped in advertising, to help Apple fluff up its revenue stream online.

Cupertino will reveal more about the service at the firm's annual Worldwide Developers Conference on Monday, 6 June, at which Apple boss Steve Jobs – who is currently on medical leave – will be present to "kick off" proceedings.

If the LA Times, which cites sources familiar with the negotiations, is accurate then the iCloud service will be a significant departure from Apple's iTunes subs model, given that ads will be slotted in.

The newspaper said that Apple has now completed the inking of contracts with the Big Four record labels, having finalised a deal with Universal this week.

Warner Music Group, EMI Group and Sony Music Entertainment have all reportedly signed agreements with Apple in recent weeks, to allow Apple to stream and sell their content online.

Apple will apparently share 70 per cent of any revenue from its iCloud music service with the record companies. Meanwhile, music publishers will get a 12 per cent cut and the remaining 18 per cent will be pocketed by Apple, according to the LA Times report.

Meanwhile, the final elements of Apple's cloud service are coming into view ahead of Monday's Big Reveal.

The company has now officially taken control of the icloud.com domain, according to Whois records. It's understood Apple paid $4.5m to Sweden-based Xcerion, which previously owned the domain.

As we reported last month, a new application for the iCloud trademark was made by Douglas Dane Baker of North Carolina, who submitted the request to the US Patent and Trademark Office (USPTO) on 6 May 2011.

Then, on 31 May, when Apple confirmed the existence of its iCloud service, the European trademark office published Cupertino's filing for the mark. ®

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