Is this actually true? I don't know. I don't think consumer file hosting services would be viable at their present price points if they were storing every single file byte-for-byte.
Certainly some of the value capture belongs to the company, but if you're not particularly concerned about security it seems like a win-win.
If you are concerned about security, encrypt your files and everyone else with deduplicated files will subsidize the cost of your service.
It's likely referring to iTunes Match which is a paid service that allowed you to upload your own MP3 files to Apple who would then serve it to you alongside any purchased/streamed music.
I believe that by default (but able to be disabled) your songs would be "upgraded" to the master-quality equivalent in Apple Music if they were identical. But then over time artists have been replacing those song with different versions/mixes.
Every distributed object store I've ever seen takes your data, chunks it into a fixed size, hashes it and then distributes copies on multiple nodes.
So deduplication is intrinsic to the architecture and not some business decision layered on top.
Apple pays the same rate to everyone and for all music, and for what it's worth it is well known that Apple pays much more than Spotify does to artists.
It is incredibly difficult to guess what related music people will like, and some people will like the selections, others won't. Apple recently added a "Discovery" station that tries to guess music you might like but don't listen to and I am a big fan of it, while many others absolutely hate it. Eh.