Apple plays customer loyalty, anti-Google cards with iCloud, say analysts

It's all about selling hardware, and fighting Android for smartphone and tablet supremacy

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Golvin was talking about the ease with which iPhone and iPad owners can already transfer their apps, music, photos and other data when they purchase a new Apple smartphone or tablet.

"They talked about how difficult it was to activate a device now through iTunes, but really it's extremely seamless," said Golvin about how a new iPhone syncs with content stored on a Mac or PC. "It takes a while to churn through, but in the end you have everything on your new iPhone that was on your old one."

Android users have nothing like it, he said.

"Apple's fighting tooth and nail with [Android], so anything that tips the scale, like iCloud, is that much more meaningful," said Golvin.

Frank Gillett, a Golvin colleague at Forrester, was more blunt in his assessment. Saying that Apple has now moved into the lead in the personal cloud market, he found the competition lacking.

"Google is worth watching as a number two player, but will struggle to match Apple as it tries to move the world's apps into the Chrome browser," said Gillett in a blog post Monday.

"[And] Microsoft, with no articulated vision for personal cloud and Windows 8 expected sometime in 2012, lags significantly," he said.

White also gave the advantage to Apple as he pointed out the $25 price for iTunes Match was lower than similar fees charged by Amazon and less than what most expect Google to impose for their "music locker" services.

Earlier this year, Amazon and Google launched cloud-based music services that require customers to upload their libraries to remote servers, from which they can stream the tunes to mobile devices and personal computers.

Apple's taken a different approach with iTunes Match, and will instead scan users' music collections and match them against Apple's library. Found matches will be available for instant downloading to the maximum of 10 devices or computers.

Tracks purchased via iTunes are available for downloading to the same number of devices for free.

In the end, analysts said, iCloud was all about selling more hardware, not about generating a significant revenue stream. "They want to sell more iOS devices," said Golvin in explaining Apple's strategy.

"Apple's saying, 'Don't pay any attention to the price of the thing [the hardware]; what you're buying is a way of doing these sorts of things," said Ezra Gottheil, an analyst with Technology Business Research in an interview earlier this week.

Milanesi seconded that.

"Everything Apple showed Monday, including iCloud, Lion and iOS 5, demonstrates Apple's full package," said Milanesi. "It's all about providing a richer experience [and] to deliver that 'Wow' experience, you need to have control over the ecosystem.

"That's why it will serve people very well," she added. "It just works."

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer or subscribe to Gregg's RSS feed . His e-mail address is gkeizer@computerworld.com.

Copyright © 2011 IDG Communications, Inc.

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