Today Apple released iTunes 10.5 Beta 6.1 to developers who are enrolled in the standard or enterprise programs. If you are registered to the program you can download the latest version from here. The new update features the implementation of iTunes Match, which allows users to upload tracks to Apple's iCloud (Beta) service.When made available, you will be able to store your entire music collection on iCloud for $25 a year. It will only upload songs that are not already on iCloud's service allowing you to access it's already vast number of songs from it's own (256 kbps AAC) collection instead instead of your lower quality file.
I don't know how Apple's is going to keep user's from exploiting this service, but I see companies like Spotify allowing users to access their vast library of song's without allowing the music to be downloaded for free, so Apple would surely have something in place to make sure your music is legally downloaded.
At this point you cannot add music to iCloud from more than one computer at a time and there are also some playback issues on iOS at this point which we are sure that Apple will work out before release. The company has suggested that developers backup their iTunes libraries before installing as iCloud updates at this beta stage could be subject to deletion.