Amazon Cloud Music: How Amazon Is Forcing Apple To Update iTunes

Today Amazon (AMZN) introduced Amazon Cloud Music, which, as my BNET colleague Erik Sherman reports, gives users 5 GB of free music space that can be accessed anywhere via Wi-Fi or cell. Apple (APPL) has added the social aspect Ping and other lame features to iTunes, but it still hasn't allowed users to access their music remotely -- and now it needs to move quickly to keep people from using Amazon as their main music source.

Makes a hole in the Apple wall
Amazon Cloud Music scans your hard drive, uploads your music, and lets you access your music catalog over a wireless connection on most mobile devices. In this sense, Amazon's philosophy is the polar opposite of Apple's: Like the various Kindle apps, Amazon Cloud Music lets the consumer choose the right device; it doesn't care about your hardware. iPhone, iPod, and iPad owners can now use Apple's Internet-connected devices to access their music -- and they are now more likely to buy music straight from Amazon.

Amazon represents unique competition
Other companies offer cloud-based music, but none is as big of a threat as Amazon. Pandora, Last.fm, and other popular services are closer to radio stations than music purchasing venues, and, as my BNET colleague Erik Sherman recently wrote, Microsoft (MSFT), Google (GOOG), and Research in Motion (RIMM) are not ready to compete on the music front.

On the other hand, Amazon just launched an app store, pushed its book service onto more than a dozen devices, and has a music store competitively priced against Apple. Apple acquired the cloud-based music service Lala last year and the highly-anticipated iTunes 10 failed to integrate any cloud technology, but Amazon is a strong-enough competitor to get Apple to finally update its music system.

Photo courtesy of Will Fuller // CC 2.0
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