Collected: Apple's iCloud challenge

By Jonny Evans

Heading to the clouds, Apple [AAPL] has acquired the 'iCloud.com' domain name, reinforcing expectation the firm intends introducing a new range of online services, presumably developed in parallel with the company's much-anticipated Lion OS and iOS 5 releases, which these services will support. And these all set the scene for the introduction of the iPhone 5 this summer, as AT&T has seemingly confirmed.

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What's in store?

These cloud-based services are expected to include iTunes music locker improvements, video-focused streaming services and improvements to MobileMe. In February, The Wall Street Journal reported Apple to be working on big improvements to MobileMe, and that it is considering making the service free.

Apple has a new and not yet operational 500,000 square-foot data centre in North Carolina. This place is five times larger than the company's current data center in Newark, Calif. "Apple is widely presumed to be readying its iDataCenter to power a cloud-based "storage locker" that can house music, video and other media for iTunes users," wrote Data Center Knowledge.

[This story is from Computerworld's Apple Holic blog. Follow on Twitter or subscribe via RSS to make sure you don't miss a beat.]

Apple's US data centre is just the start. To lead its initiatives, Microsoft's general manager of data centre operations, Kevin Timmons recently quit Redmond to take a new role in Cupertino. Analyst Peter Misek at Jefferies & Co believes Apple intends building new data centers in other parts of the US and Europe in order to expand the reach of its cloud-based plans.

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Apple reportedly spent serious cash to acquire the iCloud domain, purchasing it from Swedish online file storage service, Xcerion, for up to $4.5 million.

It is important to take these claims with a pinch of salt: at time of writing, the domain redirects visitors to CloudMe.com and Xcerion is listed as the current owner of the domain until 2018 on the Whois database.

Plausible deniability

Requests for verification of the acquisition claim have been ignored, meaning the company isn't in position to confirm or deny the reports, a fairly typical predicament for anyone doing business with Apple.

Xcerion's iCloud service is a little like Dropbox, enabling you to upload, organise and edit your data from any device, including your iPad. Like Dropbox, it offers automatic sync of files modified on your local computer, PC or Mac.

Apple has said it is taking the best of iOS inside its Lion OS. One iOS feature, 'Find My iPhone' is expected to make its debut with the new OS.

A recent Lion preview update for developers carried references to such a finding feature, linked to an upgrade for MobileMe called "Castle." A blow to Mac thieves, Find My Mac is expected to use CoreLocation to figure out the approximate location of your Mac, if it is lost or stolen. As we revealed yesterday, these plans could conceivably extend to Remote Wipe, as this is supported on-chip by Intel's new Sandy Bridge processors.

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King of the castle

As for the Castle upgrade,  French Mac enthusiast site Consomac also found a dialogue box which says "Click OK to open System Preferences and complete your upgrade from MobileMe to Castle," according to the contents of one of the localization files seen by Consomac.

Apple's had mixed success with online services. MobileMe's lack of service improvements, slowness and expense have tarnished its reputation. Apple's social network for music, Ping, doesn't inspire. Apple has nothing to compare with Dropbox, Facebook or Gmail. iPhoto and iWeb have also failed to acquire the cachet of Google's Picasa service.

It appears Apple hopes to change this tradition. It has invested stacks of cash in its data centre, in excess of $1 billion. At $581 million in Q2, Apple's R&D spend has already climbed $155 million in contrast to the same quarter last year. This likely reflects intensive development across all Apple business segments, but it's certain some of these millions reflect its data center push.

Apple's much expected iTunes music locker service means we should be able to download any music purchases to any supported device.

Spotify attacks

Apple is also expected to offer Spotify-like music streaming services, in addition to the a la carte music downloads we enjoy today. Responding to this, Spotify today launched its own music downloads store selling song bundles at per-track prices under those of iTunes, while also introducing iPod syncing from its desktop application and opening up its mobile apps to Spotify Free users

Apple's iTunes head, Eddy Cue, visited New York in April to sign new iTunes deals with Warners and other major labels, though Universal is thought to be holding out.

Additional new data services will also likely include:

-- Syncing of Apps

Set up an Apple ID and iOS and you will see all your Apps updated from the cloud. This will enable a Mac user to access their data using iOS equivalents of their Mac apps, and is a compromise position to the "your Mac anywhere" dream I talked about the other day, designed to maximize use of the available bandwidth by only updating key changes in Apps, Documents or other files.

-- Syncing of Data

MobileMe for everyone, Contacts, Calendars, Bookmark sync

-- File Storage

iCloud could be a Dropbox-killer, but I'm not certain Apple will make such a move -- I think it may want to explore the limits of server robustness before offering a full-fledged online filing and sharing system of this kind.

Video rental also remains a possibility. Apple already offers these via iTunes, but some think Apple has plans.

"We would find it easy to believe that Steve Jobs’ final hurrah before turning the reins over would be to revolutionize video much in the same way Apple has transformed the mobile, computing, and music world. It is also notable that his authorized biography is due in 2012," said Jefferies & Co. analyst Peter Misek.

Apple's shining platforms

These plans will promote the usuefulness of all Apple's platforms. It won't matter if you are using a Mac, an iPhone, an iPad or iPod touch, you'll have access to your media library and most important project documents and data anywhere. You're likely to enjoy wireless sync this way, too.

These moves make for a compelling offer for consumer and enterprise users. The biggest victim of Apple's stab into online services will likely be the new breed of me-too iPad competitors.

Many firms are introducing themselves into the tablet market at this time, but with component costs, relative expense of their propositions and no philosophical or ideological position from which to support development of these machines, there's real concern sales expectations will be confounded. Apple's move to make its tablets both powerful and extremely useful will likely help send competing tablets into land fill.

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