Will iTunes Adopt a Subscription Model? There are a lot of speculations about what will happen after Apple drops the DRM on songs purchased through iTunes.
I personally think a subscription based system is the best and most profitable strategy for the music industry. Subscriptions control the new economy. Music and movies are a service. The always were. You’re allowed to play it, but not to share it or show it in public. The content was never in your possession. You rented it for an unlimited amount of time and eventually the media outdated itself because of technological improvements (vinyl, tape).
Since the compressed files media doesn’t need a carrier anymore. It is free to move and duplicate, everything is an original. Music becomes interactive radio. You can listen to it whenever you want and on demand.
Digital Rights Management doesn’t use the advantages of new media, it simulates the cd-experience by making a digital file a physical object.
You can’t stop innovation and you certainly can’t stop digital innovation. From this perspective DRM is doomed to stop. In the same way linear television programming will end. Maybe not today, maybe not tomorrow, but it will. So, when Apple announces to stop it themselves they speed up innovation. Innovation they need to stay ahead of the competition.
The business model shouldn’t focus on the files anymore, but on the concept of a stream. Like cable television or an internet connection. You subscribe to use it. The type of the files doesn’t matter, this could be mp3 for now because it is supported by most devices. It can be something else in the future. It doesn’t matter.
I don’t need physical files on my harddrive, I don’t have to own the music (the same way you keep your money at a bank). All I want is to listen to the music I like where and when I want. It shouldn’t be so hard to sync an iPod to a web connection and load it with new music without storing files on the harddrive.
For example if I would pay max $40,- a month and I’m able to download all the music I want, I would end up paying more or around the same as I am right now, for new music. All I want is play what I like, when and where I want. Smart library software (already in iTunes) will make sure the artist gets some of my monthly fee every time I listen a song.