iTunes in the Cloud and Why This Scares Me

Apple’s (s aapl) recent media event solidified what we all knew was coming: Rentals and non-local storage is the future of our digital content. Ask any teenager if they’d rather watch TV or YouTube and they’ll answer Google’s (s goog) on-demand free service full of people doing stuff on video is their preferred entertainment. Give that teen an iPhone or iPad and YouTube is where they’ll go first. It’s appealing to have content that’s not stored locally streamed instantly and Apple/Google aren’t the only companies leading this initiative.

Right now, most of the content you own is stored locally on our Macs or iOS devices. This content includes apps, books, videos, music and documents. The cutting edge techies have embraced Gmail, Google Docs and cloud services like DropBox and The only thing keeping you from storing movies in the cloud and viewing those on your iPad is Internet speed. What if I told you the copy of Finding Nemo you bought from iTunes can be streamed instantly to any Apple device no matter where you were in the world — a café, driving down the interstate or in the London tube? It’s almost here.

Our future is wireless at speeds that meet what we have in our homes. This may be a decade away and if carriers make wireless data truly unlimited this will be a reality, but it scares me for a few very obvious reasons that simply can’t be fixed by technology.

Corporate Control of Our Data

Control by a single entity is my main fear. Cloud storage isn’t democratized and it isn’t open. Currently, when you buy something, it’s stored, owned and managed by the company you purchased it from. Apple has maintained DRM in its iTunes Store since 2003. I’ve authorized files that I bought the day Apple’s store opened and they still play on any one of my Apple devices. If I lose that song, Apple can allow me to re-download it after some back and forth with its support team. My apps, movies, music and music videos are locked to its devices. The same goes with Amazon’s (s amzn) Kindle platform. Buying a book from Amazon’s Kindle Store means that file is locked to its software and hardware. If it ever abandons Kindle, your books are useless. There’s no reason for either of these companies to do this, but people who bought music from stores that are now defunct are in a bit of a pickle with the content.

An example of a failed system is Microsoft’s (s msft) PlaysForSure DRM. A number of music stores and MP3 players adopted this, but most of those stores and hardware companies have shifted directions or gone out of business. The hundreds you spent on music may be playable right now but no one can guarantee you’ll be able to in 10 years.

Let’s simply alter my argument a bit and change the delivery of this content from DRMed files stored on your hard drive to music stored on the cloud operated by Napster or Real’s Rhapsody Store. If those services go away, the music you “own” is no longer playable…ever. Going all in on a service that is cloud based is risky business. The same goes for content stored on Google Docs, Flickr, MobileMe and YouTube. If you’re not keeping hard copies of your content uploaded to these services, you’re a fool. Hard drives are cheap. Store your content and don’t rely on these web services that have been around for less than a few years to store your content forever. Personally, I use to keep secondary backups of all my data from Gmail, Google Docs, Twitter, Facebook, Flickr and WordPress. I download copies from Backupify once a month to my hard drive.

Remember when Amazon ironically pulled copies of 1984 from Kindle devices without warning? Cloud based companies can do this. They might give you a warning but no one can come into your house and take a book. Unless what you’re storing is illegal or your hard drives are compromised, the data in your home and on your computer is safe for years as long as you’re careful. Keeping a backup of your computers on an external drive at home and a duplicate at your office is good enough and I suggest anyone do that no matter how insignificant the data is. If you store photos, music and documents on your computer, back it up off-site — no exceptions.

Apple is playing it safe with its new Apple TV. Allowing us to stream rented movies and TV shows is a good way to get us comfortable with streaming content. You can still buy the same content on your iOS and Mac devices and stream those to the Apple TV but, if you’re on a TV browsing iTunes, the only option is to rent the content.

It won’t be like this forever. Soon, streaming will be offered as a more convenient and less expensive option for us. Apple and other companies will present products where you can hit play on anything you’ve ever purchased and it starts instantly as long as you have an Internet connection from your phone, tablet and computer. Invite a friend to borrow your copy of Braveheart and they can watch it as well. This convenience will not be without problems.

In Apple We Trust

Apple is on top right now. Its mobile devices are envied by every CE company, but this won’t be the reality forever. I own 300 iOS apps, 1,200 movies, 200 music videos and over 18,000 songs where over 5,000 of those songs were purchased in iTunes. I’ve invested thousands of dollars in Apple. Thanks to limited kindness of the music industry, my music is now DRM free in iTunes Plus format so it can be played on any other MP3 player, but the other content is stuck. When Apple’s devices aren’t the best and someone else takes over, I’ll be stuck to the Apple ecosystem. The same can be said for Mac software when you make the switch to Windows 7 (for whatever reason) but it’s a reality we all need to deal with.

When you want to switch to a cooler and better mobile platform, will you be okay with giving up the thousands spent on DRMed content that can’t be played on the new device? If Apple remains the dominant leader for the next 20 years, can we trust it to be kind to its loyal fans who trust when we buy a movie stored exclusively on Apple’s cloud to always be playable and never be pulled, removed or changed? Will my copy of Braveheart always work no matter where I am or will I be greeted with an error when I’m in China with, “this movie is not licensed to be played in your region.” Where the hard copy stored on my iPad would play just fine no matter where I was? We’ll see. Apple is not a movie studio so its hands are tied when it comes to content and how that content plays just as much as any other company when it comes to music and movies.

The White Album Argument

Maybe I’m not seeing the big picture. There’s another side to this where if you ask anyone over the age of 50 how many times they’ve bought The Beatles’ White Album and they won’t be able to keep count. There was record, 8-track, tape, cassette and maybe even mini-disk. They probably also bought it in CD form the first, second and third time it was remastered. You may have bought this album eight times since it was first available in record stores.

Perhaps that’s how it’s going to be when it comes to our digital music. Perhaps, you’ll buy the same content over and over again well into your old age because there would have been a few music services between 2000 and 2050. On my 70th birthday, I may lament to my grandkids that I spent thousands on music in iTunes and they’ll laugh because music is like $20 a song now and I shouldn’t be complaining that it cost 99 cents back then.

Planning for the Future

Whatever happens next, consumers are in control. We decide with our cold hard cash. We already voted that digital is the future since iTunes sales will pass the sales of physical CDs very soon, but if we go all-in on cloud content trusting in the corporations storing and delivering it, the world may shift immensely and when you take a vacation to the mountains with your family where there’s limited cell reception, the music, movies and important work documents will all be inaccessible stored in some server that’s unreachable and you’ll have to laugh because this was the future we all wanted that corporations gave us.

Maybe I’m skeptical, but the best content is physical (bookshelf) with a digital version (non-DRM) and a backup of that digital copy off-site. If your house burns down, you’ll still have the book or CD digitally but the world we’re entering into is all digital with single corporations holding the DRM keys and now they want to store the content as well. It’s unclear what’s going to happen next. Let’s hope we know what we’re doing.

Related GigaOM Pro Research: How to Manage Access to Digital Content