It had been an on and off story with music streaming on Windows Phone using SkyDrive. Back in May this year, we first reported that Windows Phone “Mango” might support music streaming from SkyDrive, however later Microsoft outright denied that claim. Later on in July when the Beta 2 Refresh build of Windows Phone “Mango” came out, users discovered that you can in fact playback music files from SkyDrive on the phone, although it’s awkwardly accessed from the Office hub rather than the Music + Videos hub.

It seems like Microsoft has plans to temporarily change that. According to WMPU, a New Zealand TechEd attendee claims that he had seen a demo by Microsoft showing off an official SkyDrive app, which includes the ability to playback music directly from the folders. Nothing else is known, but here we’re hoping that Microsoft provides some sort of integration with the Music + Videos hub with the SkyDrive app, making it a temporary solution to compete with Google Music, Amazon Cloud Player or Apple’s iCloud.

Of course, we hope there are long term plans to bake this directly into Windows Phone itself, such that it provides a seemless cloud syncing experience between Windows Live and Windows Phone. Stay tuned at LiveSide for more news on SkyDrive and Windows Live!