iCloud is really free in name only, but that's ok.
Today iCloud was announced in all of its remote glory. The service takes the concept of MobileMe into the future. The main purpose of this is to allow all iDevice users a mobile hard drive that they can access from all their products. This means that documents worked on can be picked up on your iPad and iPhone, no matter where they started. This only culminates with music as the iTunes iCloud allows you to have a central library of music that can be used from all of your iDevices, not just one. It does this in two ways: it references files that it recognizes in your library to Apple‚Äö√Ñ√¥s licensed library of 18 million songs or it allows you to upload it to your iCloud storage space. The catch here is that you have to pay a $24.99 annual fee, which is not bad yet hardly free.
The iTunes Match system is essentially the iTunes Locker, a place where you hold your available files. The files that are on your computer are not to be lost and instead given access all across the board. Recently Apple spent a medium sized fortune acquiring rights for streaming access to a whole range of record company produced music. The goal for this was to create network of songs for instant playback. Many people suspected this would create an instantly clickable music database that would do for songs what Netflix did for movies, but it does not actually work that way. Instead, if you have those songs on your computer it creates a reference to a digital location where those songs are. You then have clearance to access those songs from all your iDevices through iCloud, and they playback just as if they were on your computer. These files are referenced at 245 kbps AAC with DRM free, which means that you are going to get clarity. If Apple does not have some of your songs, such as if it is a local or small independent artist, then you can simply upload the song.
The small fee is much less than you would end up spending at Amazon or Google to do the same thing since they require you to upload all songs instead of just ‚Äö√Ñ√∫referencing‚Äö√Ñ√π them as you do with iTunes iCloud, and you have to pay for the volume of upload. This ends up taking an obscene amount of time and cant cost you hundreds of dollars if you have a library in the tens of thousands. Your $24.99 flat subscription fee does not change, and there is not maximum storage for this music service. It does not end up coming out of the 5GB limit that you have for iCloud, which is nice since this is the dominant area that people waste storage space for iDevices.
All of this works inside iTunes, not separate to it, so you have integration with the tool you are already likely using. This means that you will essentially use your own library as a start point for developing a full media central location where you can then tie in the iPhone, iPad, and iPod Touch to from all locations that have internet access. Since every person will be given an iCloud account this means that you will begin to have your own iDentity that will allow you to keep one library for everything.