Subscription model to dethrone Apple iPod?
Digital Music - Players December 22nd, 2004
Subscription model to dethrone Apple iPod?
The current holiday season must have brought a smile on Steve Job’s face. Their music player is selling like hot cakes with shops and stores running out of iPod and iTunes is selling music like there is no tomorrow. 200 million songs is no small number and iTunes have sold more than this establishing records and setting standards for the competition to match.
However, critics are skeptical. They claim Apple is currently enjoying due to the coolness factor that comes with iPod. As it becomes old, people would realize that paying 99 cents for a song make little sense. Competition has better and cheaper options ready for them. Microsoft launched PlayForSure campaign to inform users on the products, which accepted more music stores, and file formats than iPod does. Napster is offering music on a subscription basis, which gives the users access to listen to 700,000 songs for $9.95 monthly. RealNetworks’ Rhapsody service offers something similar and even support iPod. Though Apple recently killed that support on certain models with a software upgrade.
The upcoming schemes from these services are going to let these songs play on their portable music player for the duration of the subscription. This means, users get access to a large number of songs for few dollars a month which plays on a large number of digital music players. No need to buy any song, just rent it! You get bored of it, go get new songs. iTunes in its current avatar might find it hard to compete.
However, this would need the consumer to look ahead of iPod. Coz, Apple seems to have no plans to let iPod user access to non-Apple stores.
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A rather simplistic look into the minds of consumers. For the same reason why people buy homes versus rent or buy CD’s versus borrow from friends the basic mental set up of humans is to “own” stuff. The way I look at it is that after 5 years of renting music I would have paid almost $600 in subscription fees with nothing to show for it. Since I cannot share my subscription on multiple players I am also put in a position of having to pay a couple of monthly fees for the family. While some music tends to get old I have plently of songs that date back 30 plus years that I still love listening to. For this very reason, buying will always win over renting.
Apple can only carry their success with this sale model for so long. It is going to leave a sour taste in the mouths of people willing to pay 99 cents for songs. They are betting on people being too lazy to go to other music for sale site for less. People will catch on, and they will feel scammed. For 6 songs a month, someone could pay for the access to over a million songs. Yeah it�s a rental, but if you love a CD you actually want to pay for it, you can and for less than the itunes store. Yahoo�s service is cheaper than apples for the same thing� both can burn to a CD. It is so cheap to do this, and for those addicted to free music, there will unquestionably be workarounds to their digital rights protection. In fact you already can, if you’re willing to take the time. So for the price of about 6 songs a month, why not have the cover of downloading legally with the, albeit annoying, ability to bypass protection? The internet generation is all about taking what is given to them and making it do things they want. This is another one of those things, and Apple better shape up and carries their success over to more customers and not loose all this great progress they have thus made. If they maintain this posture they will confirm their dismal market share. I like Apple, and I hope they wake up.
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