Apple tells some iCloud users: 'Pay up, or lose'

Apple [AAPL] is writing to former MobileMe subscribers to explain their free 20GB iCloud plan will expire on September 30, forcing many to either downgrade their iCloud use or spend cash to maintain their existing use.

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A new Apple tax

As of April 2013 there are over 300 million iCloud users worldwide, according to the company: "Since launching iCloud just 18 months ago, we now have 300 million people using it every day. We will continue to invest in the ecosystem and have some great new features and capabilities in the pipeline," CFO Peter Oppenheimer then explained.

Apple offered MobileMe subscribers free use of the 20GB plan when it launched iCloud in 2011. The free offer was set to last for one year, but this was later extended to two. Now the company is putting an end to this iteration of the free cloud ride.

It's not a complete disaster, all users will be migrated to Apple's free 5GB plan -- but that's not a lot of data when you consider iCloud is used as a repository for Mail, Contacts and Calendars and a host of other Apple services. OS X users will know that the default file saving location is iCloud, and the introduction of iWork for iCloud is also likely to increase use of the service. iPhone and iPad data backups can also be saved to iCloud.

It remains challenging for users wishing to micro-manage the contents of their iCloud database(s). The iCloud control panel offers limited functionality, your Mail database needs to be worked through manually and many settings are accessed via individual applications. This means that many iCloud users may find they are already using in excess of 5GB of data within their existing account. If they can't afford to pay Apple its iCloud tax, they may well stop using the service.

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Is it safe?

Apple has the right to charge fees for what it offers, but the side-effect of the MobileMe free ride has been to encourage users of iCloud to exploit the service without thinking through the consequences of that use.

The free storage offer wasn't made available to every iCloud member, but exclusively to former MobileMe subscribers. This still means thousands of Apple's most loyal users -- you had to be pretty loyal to stick with MobileMe -- are suddenly faced with the decision to pay more money to Cupertino, or simply to stop using iCloud.

A decision to stop using iCloud seems a sour option when you stop to consider the importance of cloud services within Apple's future plans. Apple CEO, Tim Cook, has previously said:

"I would view iCloud not as something with a year or two product life; it's a strategy for the next decade or more. I think it's truly profound."

I agree. I believe the impact of cloud services within the era of mobile devices will be truly profound. However, given the depth of integration between Apple's hardware and software solutions and iCloud, it seems clear most users will end up requiring far more than 5GB of storage space.

(For more iCloud storage, users have to pay an annual fee of $20 for 10GB, $40 for 20GB and $100 for 50GB.)

Fair enough?

It's good business for Apple, of course. After all, in the event it can get 300 million users to pony up even $20 per year then the company stands to trouser a rather pleasing $6 billion.

What's less ethical is that as the integration between its solutions and iCloud increases, it seems clear most users will eventually find themselves requiring more data than their allowance provides simply in order to use the profound new features Apple is introducing.

Given that at a system level, users can't assign different storage services to work with their devices in as integrated a fashion as that offered by iCloud, it seems many customers will have little choice but to pay this new Apple tax, particularly as iCloud integration becomes even more central to the user experience.

The impact of this is most keenly felt within Mail. Mail matters, it is important and sometimes critical to users. Despite this, Apple warns that should a user exceed their 5GB free storage once their account is downgraded (and fail to pay for a space upgrade): "iCloud Backup, Documents in the Cloud, and iCloud Mail will temporarily stop working."

Bottom line? Apple is effectively telling iCloud users to cough up the cash or switch to another service.

I'd be interested to find out just how much use Apple customers already make of iCloud services: how much data does a typical user already host on the service, and is 5GB sufficient to their needs. Let me know in comments below.

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