Subscription vs. piecemeal pricing of music

This week I actually suggested to someone that they avoid an iPod and instead buy something from Creative or iRiver. I know, I was shocked to hear myself say "well if you want unlimited music, no version of an iPod will work with that."

Here's the weird part -- at first I only suggested avoiding the iPod because they wanted to use Rhapsody, but the more I think about it, choosing to go with an unlimited music service seems like a smarter choice. I was glad to see Chris Anderson, editor of WIRED, talk about this last week as well.

For me and my maladjusted alpha geek friends, the idea of nearly unlimited music for the iPod is totally doable in the age of bittorrent, mp3 blogs, mp3 groups on usenet, and iTunes hacks like Ourtunes. We get almost all the music we want for free, and buy a few on the iTunes Music Store (and we go to rock shows and buy shirts and find other ways to repay the band) when we're not spending time ripping our large CD collections to high bitrate mp3 and swapping that with each other.

But for regular people that just use the internet for web information and email, locating tons of free music is a difficult task. When Yahoo or Napster or Rhapsody offers 1+ million songs for ~$10 a month, the iPod and iTunes Music Store starts to look like a ripoff in the long run.

This could be the undoing of Apple's cornering of the mp3 player market -- for a long time people have advocated a compulsory music license, where you pay $50 a year and you get all the music you want for free. The thinking behind it is that $50 x millions of broadband subscribers = more money than the music industry gets in album sales. And that's basically what these unlimited music services offer. Sure, you're merely "leasing" music because when you stop your membership, the music disappears, but all-you-can-download is what napster used to be back in the day, only this time it's crippled with DRM and there's a monthly fee. But it's still all the music you want, all the time, like napster used to be.

It seems like the music labels are always at war with Apple over pricing and I think I can see why. They prefer the subscription model where no one "owns" anything and files only work as long as you pay into it. Apple insists on letting people download copies (crippled with DRM yes, but you still get to keep the files and play them long after you pay for them) but you have to buy them ala carte, which can quickly get expensive for any music fan. And I think I see why the music industry wants to move to a subscription model -- selling albums or song downloads requires constantly coming up with new music to keep sales up. Sales are unpredictable without a constant stream of new stuff to buy, but if you get every listener on a subscription plan, that's money in the bank you can count on every month, regardless of whether or not Sting or Coldplay or 50 Cent ever do another album. Heck, most subscribers would still be paying ten bucks a month to hear old Steve Miller band tracks, as the back catalog would be the main draw in a subscription-based music business instead of the newest stuff.

Maybe I'm finally realizing that if I had to legitimately pay piecemeal for all the mp3s I've ever owned, I'd be spending thousands of dollars a year instead of the couple hundred I spend at the iTMS. Having unlimited downloads of over a million songs starts to sound pretty attractive at only ten bucks a month.

(totally weird sidenote: in my recollection, the big proponents of compulsory music licenses come mostly from the copyfight world but everyone I know from there uses an iPod)