Jobs: iTunes subscription service a no-go

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By Stevie Smith Apr 27, 2007, 18:20 GMT

While the majority of focus regarding iTunes and its music industry partners is continually centred on Apple Inc.’s continuing drive to see contentious DRM (Digital Rights Management) removed from all of its iTunes’ listings, CEO Steve Jobs has this week intonated that an iTunes subscription service is not something the California-based computer giant will bow to.Moreover, as contract renewal negotiations between Apple and the music industry’s main players loom on the horizon, Jobs has said in an interview with Reuters that industry pressure to introduce a subscription-based structure to the popular iTunes Store isn’t likely to happen because “customers don’t seem to be interested in it.”“Never say never,” Jobs offered cautiously, before outlining that history has shown that “the subscription model has failed so far.” However, it would appear that much of the music industry is angling to have iTunes open a structure that would see its music content rented to users for the sake of increased recurring income, which could possibly spark a leverage struggle between subscription implementation and DRM removal when the aforementioned negotiations finally open.And Apple’s position seems clear, with Jobs offering that: “People want to own their music.” Yet, while Jobs appears to be supporting the consumer with that statement, it is somewhat misleading insofar as iTunes users, rival download service users, or physical CD consumers don’t actually ‘own’ the music they listen to. They haven’t purchased the music itself, but rather the license to listen to it, and in the online world DRM enables music companies to dictate as to when, where, and how consumers have access to the products. Naturally, for music companies to relinquish DRM they would be looking for increased revenue from the likes of Apple, hence the pressure to integrate a subscription element, or even rumours surrounding profit share demands on sales of Apple’s iPod music player.“We’ve said by the end of this year, over half of the songs we offer on iTunes we believe will be in DRM-free versions,” Jobs said following the inking of a DRM-free music deal with EMI Group. “I think we’re going to achieve that.” And that prediction may well come true by the close of 2007, but with the remaining three major music companies holding fast to DRM (namely Vivendi Universal, Warner Music, and Sony BMG) it seems only logical that Apple will be left looking at negotiated revenue concessions, especially if rival download services should choose to alter their models to accommodate DRM-free music choice, which could lead to an undermining of iTunes’ present 80 percent market share. Since launching in 2003, the Apple iTunes Store has seen more than 2.5 billion songs downloaded. “Never say never.”

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JAApr 30th, 2007 - 01:05:14

Why is there this media obession with a 'subscription based model' for music? The very notion of it is silly. Who wants to rent music? Well judging from all the failed attempts at it and MS's abandonment of it in the Zune ... I'd say no one.

Customers like to own there own music pure and simple.

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vinyardviolinApr 30th, 2007 - 13:20:05

i would agree.
Music is art, art is not something people rent. You certainly wouldn't rent your art from a rent-a-center. Considering how overinflated the CD market still is the idea that people want to buy their music, but not necessarily own the hard copy is something to be reckoned with. That is the whole appeal of Itunes and other legal download operations.
The way it looks is the music industry is trying to strongarm Apple with outdated models that don't work.

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RenterMay 3rd, 2007 - 18:38:15

I happen to like the subscription model because I think its the perfect model for someone who loves all types of music...I can listen to any kind of music i like..whatever mood im in...if there is someones album who i would never buy but dont mind listening to -- i can pull any of that instantly up with a subscription

It works for me - but may not work for everyone

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