If you don't renew the yearly $25 subscription, your iCloud store goes away. iTunes purchases will still be available to all devices, and anything that you have downloaded from iCloud to you devices you keep. This includes iTunes Plus versions you have chosen to replace older, lower quality rips in your main iTunes library. Apple explained that replacing those lower-quality rips is optional.
Fortune noted that this process presents somewhat of a "loophole" for dirty pirates to essentially pay $25 for "amnesty" of up to 25,000 tracks. We don't entirely agree, though. There doesn't appear to be a reliable way for Apple to know for certain if a particular song has been pirated—barring certain metadata that could be easily stripped out—so really the only benefit is that low-quality rips get replaced with high-quality rips.
A lot of readers asked if Apple shares any information about users' scanned libraries with third parties. Apple tells Ars "no," so the RIAA won't suddenly have a list of every song you ever downloaded or ripped. For the purposes of accounting, though, the company does share aggregate information about which tracks are being added to iCloud via iTunes Match. In other words, EMI will be able to know that 2 million users have Katy Perry's "Teenage Dream" in their library, but not which particular users have it.
Another question our readers asked was what happens if your library is filled with higher quality rips, such as tracks encoded in Apple Lossless (ALAC) format. Matched tracks will still be in 256Kbps iTunes Plus format, while uploaded tracks will retain their original format. Tracks aren't replaced in either your iTunes library or on your devices unless you request them to be, so the lossless files in your main iTunes library will be safe. Sticklers might balk that matched tracks won't be available via iCloud in a higher-quality format, but if you don't require lossless quality on your mobile device, having access to smaller 256kbps AAC files via iCloud may be a benefit.
Our international readers wanted to know if iTunes Match will be available outside of the US. Unfortunately, for now, iTunes Match is limited to US iTunes Store users. While the service may eventually be available to users in other parts of the world, it will require inking agreements with record labels, music publishers, and other rightsholders for each separate country or region. Apple may be in the process of doing that now, but the company said there is nothing to announce regarding availability of iTunes Match outside the US at this time.