Earlier this week, we covered
Amazon's announcement of its new 5GB Cloud Drive service. Amazon is pushing the free service as a "upload once, access anywhere" option that allows users to play the music they want, wherever they are. When questions of licensing were raised, Amazon spokesperson Cat Griffin told Ars Technica: "Cloud Player is an application that lets customers manage and play their own music. It's like any number of existing media management applications. We do not need a license to make Cloud Player available."
The music industry isn't particularly happy with that answer, and neither are some of Amazon's competitors. Companies like Sony and Apple have been unable to reach mutually satisfactory arrangements with the music studios over questions of licensing and compensation. Amazon didn't offer the record labels anything special—it just ignored them and launched a service anyway.
Music, is "upset" by Amazon's actions, noting: "We hope that they'll reach a new license deal, but we're keeping all of our legal options open." Another executive in the music business have described Amazon's move as 'somewhat stunning' and noted "I've never seen a company of their size make an announcement, launch a service and simultaneously say they're trying to get licenses," said the executive, who requested anonymity from Reuters because the discussions were not public.
The industry is already waving the legal red flag on Amazon's claim that it doesn't need additional licenses. Part of the problem may well be cultural. The entire music industry relies on a business model that treats music as a series of physically manufactured widgets that can be licensed, bought, and sold. Until the late 1990s, musical widgets were tied directly to physical media. Even with digital distribution, there's still a sense of physicality—as the Limewire case demonstrates, the record studios were hoping to assess damages based on every distinct infringement that Limewire facilitated.
Distribution via cloud computing is even more abstract. Post-purchase, songs and albums are disseminated into a model we'll describe as 'Buy Once, Play Everywhere.' It's built on the music industry's neuroses regarding music subscription services but leaves out comforting words like "rent, "license," " and "provided you continue to subscribe."
decision to launch without license approval may actually be aimed at bringing the studios to the bargaining table more quickly. Attempting to claim that Amazon is acting illegally may be little more than saber-rattling. There's precious little difference between off-site storage and cloud storage. Users might attempt to use Cloud Drive to distribute infringing material, but centralized bandwidth monitoring could track such issues.