After all the years Apple has refused to take on any sort of unlimited download service for music, it looks like this is set to change with a report that Apple is now in discussions with the major record labels about a new business model. Rather than go with a subscription service, Apple is proposing an "all you can eat" type model where one would pay a premium on an iPod or iPhone to gain unlimited free access to the iTunes music library for the life of the device.
At the moment, they are still struggling to resolve a pricing issue that Apple is willing to pay the labels for this. Apparently, Nokia is understood to be offering its partners about $80 per handset, while Apple seems to only be interested in offering a mere $20 per device. According to a record label executive, research has found that consumers would be willing to pay up to $100 premium for unlimited music for the lifetime of their product or up to $7 to $8 for an unlimited download subscription.
If Apple goes ahead with a subscription model also, they are likely to only do so for its iPhone series where the mobile operator would charge the customer for the subscription as part of the monthly bill. Also in discussion is to allow customers to keep up to 40 to 50 tracks per year that would be transferable to another iPod as well as not expire once they cancel their subscription.
Going by this New York Times blog, apparently the music industry suggests limiting the right of the unlimited music bundle to one or two years after purchase and then require the user to pay a subscription to retain their unlimited music access for the product. While Apple has never offered any sort of music rental service, they already do offer video rentals, so the technology for limiting playback over a certain time period is already present on iPhones, video capable iPods and its iTunes store, at least for video content anyway.
In my opinion, this idea of introducing iPods with an additional premium for unlimited music downloads would work out very well in certain cases. For example, those who don't have a credit card or trust shopping online would be more likely to pay for an iPod with the premium for unlimited access to music than buy a regular iPod taking on the risk involved with downloading a lot of music illegally from P2P services.
On the other hand, the obvious drawback is that not everyone will be keen in having their entire music collection locked on a single device, particularly if they are aware that they would lose most (if not all) their music once the player reaches the end of its life or the user changes player. It’s also unclear if music downloaded as part of the deal can also be played on the PC it was downloaded on.
