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Record Labels Upset Over Amazon's Cloud Drive

Tuesday Amazon launched its new Cloud Drive service which allows users to store music, documents, pictures and videos on Amazon servers. On the music front, users can stream uploaded tracks back to a browser-based Cloud Player or through the Amazon MP3 app for Android devices. Even more, those who buy music on Amazon will automatically see their purchases stored in their virtual drive.

While the Android end could use a bit more polish (mSpot provides a better interface and widget), the Cloud Drive itself offers a hefty 5 GB of virtual locker space for free, with optional premium prices consisting of 20 GB for $20.00 / year (which may be what Apple is brewing too), 50 GB for $50 / year and so on.

Naturally 5 GB isn't much for storage when throwing HD movies into the virtual space, and likely not enough for those only storing their collection of music. Still, premium service pricing for the larger capacities acts more like an insurance policy, ensuring that your purchased files are protected when they could otherwise be lost due to corruption and hardware failure.

But with just twenty-four hours under its belt, Amazon is now taking the heat from record labels, a backlash that could "ignite a legal battle" between the music industry and Amazon. Sony Music claims that Amazon launched the service without licenses for music streaming, and has threatened to keep its "legal options" open if the online retail giant doesn't sign a new licensing deal soon. Another label said it was notified of the service only just last week, adding that Amazon later addressed the issue of negotiating licenses. The label executive even called the move "stunning."

"I've never seen a company of their size make an announcement, launch a service and simultaneously say they're trying to get licenses," the unnamed executive said

As it stands now, consumers have a right to purchase and download songs to store on their own hard drives. Apple and other digital distributors have even made it easier on consumers by stripping purchased audio of annoying DRM (although the files are still tagged with the purchaser's name) for better music management. However, it's currently unclear if the same rights apply when storing the same files on remote cloud-based drives and then streaming the music across the internet.

San Diego-based MP3tunes launched a similar cloud-based service back in 2007 and quickly felt the wrath of record label EMI's lawsuit. MP3tunes founder Michael Robertson is now watching the music industry react to Amazon's new service, stating that "labels have engaged in a legal terror campaign over the last 10 years using litigation to try and slow technology progress."

It's speculated (and somewhat obvious) that Amazon rushed to launch the first virtual locker service onto the market. Google is expected to launch a music-based branch of its online storage in May, followed by whatever Apple is brewing up in June.