Apple may turn MobileMe into digital shelves where iTunes users can store electronic books, songs, and movies.
MobileMe is an online storage locker, a service that enables users to keep calendars, address books, and e-mail on Apple's servers. In the future, Apple could turn the service into an entertainment and media hub, where users maintain their digital music and video libraries, according to a report in The Wall Street Journal.
MobileMe costs $99 annually to use, but Apple may turn it into a free service, the Journal report.
Computing done over the Internet is commonly referred to as taking place in "the cloud" and this is where the next generation of digital entertainment is supposedly headed. Cloud services are supposed to free up hard-drive space on consumer PCs while providing users the ability to access content from wherever they can connect to the Internet. Google is also working on a cloud music and video service, the sources have told CNET. The search company could be ready to launch a music service within the next several months, sources said.
If we do see an iTunes cloud service, it will come as the growth of song downloads has slowed to a halt. According to Nielsen SoundScan, overall U.S. music sales fell 2.4 percent last year while digital track sales grew only 1 percent.
Early last year, sources in the film and music industries told CNET that iTunes executives had discussed building a cloud service. Since then, Apple hasn't done much to license movies, TV shows or music for the cloud, the people familiar with the talks said.
Meanwhile, the Journal also reported that Apple is working on a less expensive, smaller version of the iPhone. Days after Bloomberg reported that the new iPhone would be one-third smaller than the iPhone 4, the Journal reported that the device would be about half the size.
Offering users a means to store digital video and music isn't new. In video, adult-film companies, such as Pink Video and HotMovies.com, have already staked out turf. Music services such as Lala, the struggling streaming music service that Apple acquired in December 2009, had built a niche following partly by offering users the ability to store songs on the company's servers.
At the time of the Lala acquisition, many observers speculated that Apple wanted the music service to help create its own cloud. It appears now that managers there may have chose to stick with homegrown technology in MobileMe.