[stcredzero]

A cloud hosting model subsidized by hardware sales would have many advantages.

For one thing, it would feel "free." People wouldn't be explicitly paying for the privilege of listening to music they already own. They'd be implicitly paying for super-convenient hosting and access from everywhere.

In effect, it would be almost the same thing, but the spin on the two models is vastly different. It could be entirely hidden for someone who buys a new Macbook every two years with AppleCare.

Come to think of it, maybe it would be a good idea to sell such hosting included as a part of AppleCare. Cloud hosting of user media data could well reduce the warranty related costs for Apple.