Subscription iTunes? It can't come soon enough

Subscription iTunes? It can't come soon enough

Summary: Apple may be finally getting a clue about music subscriptions. We can only hope that Apple gets on the subscription bandwagon.

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TOPICS: Hardware, Apple, Mobility
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Apple may be finally getting a clue about music subscriptions. We can only hope that Apple gets on the subscription bandwagon.

The Financial Times reports:

Apple is in discussions with the big music companies about a radical new business model that would give customers free access to its entire iTunes music library in exchange for paying a premium for its iPod and iPhone devices.

The "all you can eat" model, a replica of Nokia's "comes with music" deal with Universal Music last December, could provide the struggling recorded music industry with a much-needed fillip, and drive demand for a new generation of Apple's hardware.

For what it's worth, the Financial Times report appears to be a trial balloon (Techmeme). I doubt that there will be one premium for forever access to the music library. The model will be something like this:

  • You pay a premium for a year's worth of iTunes all you can eat access when you buy a new iPod;
  • After that year you renew for something like $80;
  • Apple collects recurring revenue and subscriptions become a big business.

Greg Sandoval reports that no one is commenting, but does acknowledge that revenue sharing and prepackaged music would be a dramatic turn for Apple.

I could never figure out why Apple hasn't offered a subscription service before. Apple has the DRM, it has the platform and it has the critical mass. Instead, Apple CEO Steve Jobs has always maintained that people want to download music and own it. That may be true to a degree, but there is a dirty little secret about all of this downloading. You have to manage your library. You own music you don't want anymore. And you still have to go out and get new stuff. It gets old.

My hunch is that Jobs has gotten used to the idea of recurring revenue with iPhone and its monthly kickbacks from AT&T. It's possible that Jobs had a financial epiphany about subscriptions and the power of recurring revenue.

Enter subscriptions. I'd rather have a subscription music service. I'm sick of my music. That's at least part of the reason why I subscribe to Sirius--I'm lazy and would rather have someone just play new tunes I haven't heard than have to go looking for them. Of course, the other primary reason for Sirius is Howard Stern, but that's another post.

The point: Apple has what it takes to make music subscriptions the norm. In fact, Apple can make music subscriptions palatable to the masses. Music is perfect for the subscription model if done well (and Apple can do it well).

If this Financial Times report is true, I'm a happy camper. Apple's move to a subscription service can't come soon enough.

Topics: Hardware, Apple, Mobility

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26 comments
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  • Huh? Can't come soon enough?

    The title of the blog makes it seem as if somehow a buck a
    song is killing the iTunes store. While having the choice to
    subscribe to music may be nice most of the world seems to
    prefer a buck a tune. None of the subscription music stores
    are doing nearly as well as the iTunes store. We are getting
    subscribed to death in this culture and end up owning
    nothing. I rate subscription music right up there with Payday
    Advance.
    Zoraster
    • Precisely.

      This is nothing more than assumption of majority. Because
      the author wants music subscription, he assumes everyone
      else does, too, facts be damned.

      Apple is the number two seller of music in the United States.

      People who want to rent their music are in a tiny minority;
      not even worth the hassle required to accommodate them.
      frgough
      • I myself agree....

        I just don't see the economic sense of "renting" when owning
        has always been the better choice. However if some do I
        would disagree that perhaps it should at least be an option
        for iTunes. Still I don't see it as being necessary iTunes
        continued success and other sights lack luster performance
        just go to show that the Author is in the minority on this
        one.

        Pagan jim
        James Quinn
        • I rent lots of movies

          Why not rent music too. There are tons of songs on I-Tunes that I'd ignore because I'm not willing to fork of a buck to see if they are worth it. But subscribing to get all I can eat then I'll browse lots and buy what I like because I only want to own what I like. I don't feel like paying for two dozen songs only to find I like one of them.
          voska1
          • I rarely watch the same TV or Movie twice...

            I only purchase what I know I like for music. So renting
            makes little sense too me and unlike TV or Movie I do like
            listening to the same songs multiple times. They seem to
            effect me differently stimulate different parts of my being I
            guess. If I've seen a show movie or TV once the jokes are
            stale or the action is well been seen and not longer
            surprising or amazing. Same with horror.... can't get
            jumped if you know when the monster is going to show
            up. The story has been told and I know it already...been
            there done that. Music gets me differently for some
            reason.

            Pagan jim
            James Quinn
          • I watch movies tons of time

            I can't even count the number of time I've seen Star Wars. So for me movies are pretty much the same as music but take more time. I think most people are like that. Sure many say they only watch a movie once but they are in the minority as proven by TV run movies, TV movie channels and DVD sales. If everyone only wanted to watch a movie once they'd never buy a DVD, wouldn't pay extra for all the movie channels like Deja Vu or buy DVDs.

            Music works much the same way only a song is less than 10 minutes for a most them.

            So just like I rent a movie for $5 and then buy or not later the same to greater extent is done with music. The market is there.

            So I'd say you are the minority and really no one is forcing you to subscribe. I suspect you probably don't subscribe to cable movie channels either.
            voska1
          • You are in the minority here Voska

            I could not site down and watch the same movie back to back the same way I listen to music. For movies The surprise is no longer there, the joke has probably gotten stale etc. Now I can listen to a favorite song countless times per day, back to back with no problem without tiring. And most buy DVDs for their collections for those movie nights, but not to watch over and over they way you do.

            I believe you are in a unique minority here. Most do not equate renting movies or paying for cable to renting music. The fact that subscription music have not taken off says a lot.
            dave95.
  • Ultimately, I need both

    The reality is that I want a subscription service that allows me to own my music. I do not want to be nickeled and dimed to death by $.99 downloads that add up quickly. I go through a lot of music in a year. I listen to a lot of radio (Sat and traditional) to gain exposure to new artists, then I buy what I want to own either through download or discount CD's. Then I load up my MP3 Player with a plethora or diverse music that I listen to about 75% of the time. My tastes run wide and deep. I listen to almost every style as well as new and old recordings. I go back to the oldies often. I keep about 20,000 songs in my library right now and look forward to doubling that in the next few years.

    I do not mind paying for that privilege, but I do not want to PAY AND PAY AND PAY for it.
    philpenn
  • Well, it's about darned time, but!...

    The plan is goofy as hell!

    I already own THREE iPods, including one of the new 160GB Classics. From what I'm reading here, I would be forced to buy a 4th just to have the privilage of a subscription service?

    That would be totally absurd and I would never, ever go for such a thing.

    Apple needs to consider it's CURRENT long-time customers.
    BitTwiddler
  • RE: Subscription iTunes? It can't come soon enough

    The only problem with a subscription service is that unless the subscriber uses the service a significant amount; it doesn't make any sense. With so much multimedia available, I find myself not having enough time to look and listen to everything. That's why I cancelled Netflix; I am too busy in my life to watch enough movies to justify a monthly fee.
    buddha2lotus
  • People do want to own

    I know I'd prefer owning. But the thing is I prefer to own what I know I'll want. A subscription service allows me to sample freely all that there is. I look at much like buying a satalite radio and paying monthly. I find something I like then I buy it. Also it's fun to just download download and download. Keeping track of what I like.

    Now if Apple does a subscription service they should allow the option to purchase any of the songs I download. I might like some and I might not like others.
    voska1
    • Exactly!

      I used Yahoo Music Service until the software became so bad.

      I then used URGE, which was wonderful. Then Rhapsody bought out URGE and absorbed it into their service which I cannot stand and will not use.

      So right now there is nothing out there good that integrates directly into WMP11 like URGE did so well.

      A full, reasonably priced iTunes sub service would be great.

      My CD library almost doubled after I started using a music sub service. It allowed me to really dig in and reserch what I wanted to own, and didn't want to own.

      It also allowed me to isolate those one-off's I could buy instead of the whole album, and I'd just jump over to amazonmp3 and buy it.
      BitTwiddler
  • RE: Subscription iTunes? It can't come soon enough

    The reason why Apple hasn't gone the subscription route is because Apple knows the limitations of any DRM - it will be broken. Once its broken, I could potentially download, break, and own the music. No renewal needed in a year.

    I like subscription music services because I consume thousands more tracks than I ever want to buy (I get click happy and because I can, I pretty much download every new rock album that my subscription service gets). In fact, I probably only want to own a handful of albums a year. Seriously, in ten years I'll probably want to purge many of those albums I actually bought. I've no problem renting my music - I rent movies and video games, and get many of my books from a library.
    theillmunkeys
  • Thanks, but no thanks!!

    I do *not* want a subscription model!! In fact, I *hate* subscription models! It's much preferable to pay as you go, for the specific content that you want. Why the heck would I want to pay on a continuing basis, and then lose my tracks when I end my subscription? Uh uh. No way.
    Techboy_z
    • Depends what you like

      I have friend who feels the same about movies. He won't go to a movie in theaters, won't subscribe to movie channels on cable and won't rent a movie. If he wants to watch a movie he buys the DVD. That has it's advantages I suppose but I think he misses the theater experience and spends a lot on movies he doesn't like that he never watches again as he sells them to pawn shops if he doesn't like them for $2.

      Now most people aren't like this as this is extreme and some are on the opposite spectrum like my brother who doesn't own a single movie but subscribe to movie channels and netflix. People can fall anywhere in between.

      Now music is no different and I have to say I really enjoy sampling. The way I sample I'd be broke in no time paying a buck song. Most of the songs I'd sample I don't care for but I do stumble on few I really like and those I'd buy. Back in the Napster day I was downloading demon. Downloading songs as fast as I could and bought tons of CDs because of it. I'd find all kind of music I want to own but for every song I found I liked there was probably two dozen or more I didn't like. Now legit service exist allowing this, why not I-Tunes as well? I'm sure they could do a better job that the other as the others all suck.
      voska1
  • A combo deal might be better

    I think the best model for iTunes might be just a simple 25 cent (or whatever) download to listen for a day. Then an additional fee to remove the DRM and make it a keeper.
    HooNoze
  • Ignorance is rampent on the Music Industry

    Contrary to what TECHIE's may think...the music industry is fed up being a bitch to the world.

    Statments like these are nothing shy of ignorant as the so called subscription model does squat to support the artists/song writers or more to the point of this article the industry itself!

    It only further hurts the industry that is broken from top to bottom...but change is coming and a subscription base on top of a model that is completely corrupt is only temporarily viable. Jobs knows one thing...people want to own their music and he is right about that 100%.

    In case you haven't noticed...the buisness model for the music busisness is dead (RIP)Steve jobs and the rest of these subscription sevices are not supporting squat...just their own bottom lines.

    Next time you write an article on the music buisness think about the artists and not your favorite gadget that is just THAT without the music created by the artists (industry)
    christopher.j
    • how so?

      "Statments like these are nothing shy of ignorant as the so called subscription model does squat to support the artists/song writers or more to the point of this article the industry itself!"

      Why not? What kind of support are you talking about. Monetary? If I have subscription I'm paying for starters for it and when I find the music I like I'll buy on CD or download where I own it. So no loss of money and if anything I get exposed to music I'd not regularly get exposed and buy more. Doesn't seem like a raw deal to me.

      Of course the industry could keep going in the stone ages where I hear nothing worth buying and buy nothing because of it.
      voska1
  • RE: Subscription iTunes? It can't come soon enough

    Subscription music is a failed business model, period. I can't understand how
    folks keep trotting this out. If subscription music was what people wanted
    you'd think that MTV could make it happen. The online subscription music
    stores have been marching into the dust bin of history for years now. Where are
    they now: Yahoo music, MSN music, AOL music, MTV Urge, Virgin Digital music.

    This was worth writing about five to ten years ago. Shouldn't there be
    something more forward thinking from a blog entry on technology. At this rate,
    I expect that in a year or two I'll find articles here on the health benefit's of
    tobacco or laudanum. It is now the year 2008, take your eyes off the rear-view
    mirror for a minute, because there just might be something interesting to write
    about out there.
    Mr. Walsh
    • Not failed, look at Satalite radio

      People pay much more for that and you don't get to keep the music either. I suppose you could record it but what a pain.

      As for the failed businesses offering subscriptions I'd say they didn't do it right.
      voska1