Apple to pay music labels big advances

Apple will pay up to US$150 million in advance royalties to the four major labels for iCloud music rights, according to a published report.

The maker of iTunes has agreed to pay each of the top record companies between US$25 million and US$50 million each in advance royalties, the New York Post reported last week.

The report, however, has been disputed by a source with knowledge of the talks, who told ZDNet Asia sister site, CNET, that Apple is not making any advanced payments.

Apple announced that it will unveil at its Worldwide Developer Conference a new service called iCloud. While Apple has not offered any specifics about what iCloud will offer, CNET and others have reported that Apple has talked to the labels about a cloud music service for over a year and will unveil music-related features at WWDC in San Francisco on Monday. Last week news broke that Universal Music Group had signed a licensing agreement for iCloud, becoming the fourth and final major label to sign on.

Apple previously had negotiated cloud deals with Sony Music Entertainment, Warner Music Group, and EMI Music. It is still in licensing talks with the major music publishers.

The iCloud is expected to offer users a means to store their iTunes-purchased music on the company's servers and then access those tunes from Web-connected devices. Sources told CNET that streaming music will not immediately be made available on Monday and that Apple has plans to someday store songs users obtained outside of iTunes.

The Post also reported that the size of the advance payments is what stalled negotiations between the labels and Google, which launched an unlicensed cloud storage service in recent weeks. An unlicensed service is much more limited because of copyright concerns. But Google and labels continue to negotiate, and the search company could launch a licensed service by September.