Any maybe Apples free cloud storage should be based on number of devices you own? I have an ipad and iphone, the 5 gig goes alot shorter for backups to the cloud. 5 gig per device would be a nicer gesture.
I guess another way of looking at it is that much of the data is shared between your devices, rather than duplicated. For example, say I have 7gb of photos on my camera roll. This is going to be the same 7gb of photo data which gets synced between your iPhone and iPad and Mac. It's not a separate 7gb of photos for your iPhone and your iPad.
What I feel Apple should do is offer unlimited icloud storage for photos and backups.
I can see why Apple would be hesitant to do this. The bulk of my icloud storage is used on photos and nightly backups, and that's precisely why I pay $1 a month for the extra storage, because 5gb just doesn't cut it. My photos alone is 6.1 gb and it is not unheard of for people to subscribe to the higher storage tiers, especially if they are doing photo editing with pictures of way higher resolution and storage size.
If Apple did this, they are losing $12 a year per paying customer (at least), which I imagine is no small change, even if only a small number of customers subscribe.
To further play devil's advocate, Google gives out free storage not out of the kindness of their heart, but because they need the critical volume to aid in their image recognition software, and because they probably expect to monetise it from the end user somehow. Their business model is also quite different from Apple (Google subsides their cloud services with ads, which is contingent on user data, while Apple subsides software through hardware profits, and the money is still theirs even if you use other services on your Apple products). There is also some compression of the photos (which people may not appreciate), and you ultimately can't beat the integration of icloud photo library at the OS level, especially when you are as entrenched in the Apple ecosystem as I am.
However, I would argue that given all the work that Apple has put into developing icloud photo library, it seems like a waste that only a fraction (which I confess that I have no idea how much) of their user base is using this feature, precisely because they are unwilling to pay $1 a month. Apple sells us the user experience. Let their users have the peace of mind of being able to back up their devices without having to agonise over every single iota of storage used.
If people argue that unlimited free storage is ripe for abuse, I am sure there are ways of mitigating the edge cases. Maybe limit the free photo storage to photos taken by your iOS devices (i.e.: only photos of 12mp and below count towards this).
iCloud backups is also a feature that Android smartphones currently do not (and cannot) offer (correct me if I am wrong on this). What better way to keep us as loyal Apple customers than to get us hooked on the ease of backing up and restoring my devices?
Perhaps some executive up there at Apple decided that icloud ought to be a self-sustaining and revenue-generating entity in its own right, but this seems quite short-sighted.