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Universal gathering allies to take on iTunes

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By Charles Starrett

Contributing Editor
Published: Friday, October 12, 2007
News Categories: Digital Media

Universal Music Group chief Doug Morris is gathering support from other labels, including Sony BMG and Warner Music Group, in hopes to build a subscription-based iTunes competitor, reports BusinessWeek. The service, which is among several under consideration, would be called Total Music, and would tie a $5-per-month subscription fee to the price of compatible players. Unlike current subscription plans, this business model would allow consumers to pay just once for the player, and have unlimited music for the life of the device. It is estimated that this plan would add about $90 to the price of any Total Music device. “If the object is to wrest control of the market from Steve Jobs,” says Gartner analyst Mike McGuire, “this is a credible way to try it.”

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Comments

1

I’d never buy anything from a music company. Their goal is to reel us in from itunes who’s goal is to keep tracks at 99 cents and make it’s money off the players. Universal makes money off the music. If they become the industry standard, they will eventually raise prices. Stick with itunes because it’s in their best interest to keep the media cheap. If universal has it’s way we’ll be paying $20 for an album just like they did with their CD’s. Don’t use them or any other music company. They want to hose us just like they do their artist. These are the same pigs that are suing a mother for hundreds of thousands of dollars. Take a stand people and keep boycotting the music companies. itunes forever.

Posted by George on October 12, 2007 at 7:29 AM (PDT)

2

iTunes will be my ONLY source for digital music. I don’t understand why everyone’s trying to stick it to Apple, who has brought inexpensive music to the masses and transformed the industry. Oh yeah: greed.

Posted by bookcase on October 12, 2007 at 7:42 AM (PDT)

3

I’ve been enjoying Amazon’s download service.  You get the music in MP3 format at 256K without any DRM.  A lot of songs are less than $.99.

Posted by Randy on October 12, 2007 at 7:51 AM (PDT)

4

What I don’t think they are taking into account is they not only have to wrest control of the music from the iTunes Store. They will also have to pry the millions of iPods out of consumers hands. Even if they are successfull in pulling music out of the iTunes store, will it be worth the sales losses while they starve the iPod?  Will people eventually buy a device they are unfamiliar with, and won’t work with what they may have already purchased? The iPod was a sucess without the iTunes Store, it just made it more convienient. These are the things that the encumbant industry has to take in account trying to resist the iTunes ku. Otherwise they will just be fighting with the Zune for a small chunk of the market while making the larger portion of thier customer base unhappy, which they are already doing by treating them like criminals in the first place.

Posted by Josh on October 12, 2007 at 7:52 AM (PDT)

5

eMusic will be my ONLY source for digital music.  Raw MP3 with no DRM, plus I love the awesome quality of the music that these independent artists and labels are creating.  Not a single dime is going to any of the RIAA or these “big 4” labels that are trying to screw everyone over.  However, I have to applaud Apple for standing up to those clowns and keeping the prices on iTunes at a fairly reasonable price.

Posted by SkiBumMSP on October 12, 2007 at 7:54 AM (PDT)

6

The “rent your music” model has not worked in any form they’ve presented, so here’s a new idea… let’s try it *THIS* way!  Oh yeah, people will eat it up if we jack the price of the player way up and tell them they can download all the music they want FOR LIFE!  Well, yeah, just for the life of the player, but WOW!

What a pathetic shell game.  The music industry must think that I’m an idiot.  It’s still the “rent your music” model, no matter how you dress it up.  And in order to get that music that I won’t own, I have to change to an inferior player (obviously I think the iPod is superior or I wouldn’t have purchased it in the first place).  Where does the line start?!?

Here’s a little something for the music industry: “the definition of insanity is doing the same thing over and over and expecting different results.”
- Benjamin Franklin.

Posted by Nusm on October 12, 2007 at 8:02 AM (PDT)

7

There’s also the fact that this is a subscription-based service that’s using specific players. This service will lock you into using what will likely be a very cheap (in terms of cost and quality) device and an unproven subscription based service, like Napster, that when fails will leave you with a crappy player that you can’t use and you’ve been paying $5 every month that you will have nothing to own to show for it. Then, guess what, you’ll have to go buy a new player and re-purchase all that music you’ve been paying monthly to rent.

Posted by Luke on October 12, 2007 at 8:04 AM (PDT)

8

Oh yeah. Music subscription services have been a proven way to beat iTunes.
I used iTunes for four years. I don’t anymore. What made me switch? A better deal. Songs for .89-.99 cents, at a higher bit rate, and most importantly, WITHOUT DRM! Call me crazy, but I just don’t see the point in renting music. I’d rather buy it and be able to play it whenever I want on whatever I want.

Posted by Miranda Kali on October 12, 2007 at 8:06 AM (PDT)

9

Nothing can be a “proven way to beat iTunes” because iTunes hasn’t yet been beat in the digital download market. I do agree that buying from a record label is NOT the way to go though. They are thieves, and they are trying to prosecute other thieves from stealing from them. Thieves stealing from thieves, who really cares?

Posted by James Tavern on October 12, 2007 at 8:11 AM (PDT)

10

Let’s ask the people who used Virgin’s subscription service how well that worked for them….

I don’t get it.  The music companies use the (false) argument that an iPod locks you into one provider and is bad for consumers and then they propose a system that locks you in, and limits your choice of music players in the future.  Nice.  And this is better for consumers how?

Amazon’s MP3 store shows the better way to compete against iTMS.  I use both - iTMS is convenient and has a better selection, Amazon is more cost effective and great quality downloads.  This is what’s good for consumers - choice and value.

Soon enough the record companies are going to find themselves in a real hole as more and more bands follow Radiohead and NIN’s lead as the just produce the music without the labels.  It will be interesting to see how this affects iTMS and Amazon as well - why go through them when you can just sell off your own website.

Nice Franklin quote nusm!

Posted by DomArchitect on October 12, 2007 at 8:53 AM (PDT)

11

This new move by Universal has just lead me to believe that in the end they will be the real losers. Prior to the debacle with Apple, I was all for purchasing media products fair and square, but now, I hope P2P networks spring up all over the place. I saw an interview about 4 years ago with Prince when he discussed a bit of the fight he was having with Sony. He mentioned that record companies are the scum of the earth and that they have no real intention of providing value to the consumer but squeezing them for as much as possible. Remember when CD’s were supposed to cost only a few dollars, and 25 years later they are still at the same cost while production costs are almost nil? Prince went on to say that there was a clause in his contract that mentioned the moon and the stars. He had no idea if they knew something that he did not know. Anyway, I have no sympathy for record companies and hope they get downloaded to death.

Just my $.02

Posted by Don Trammell on October 12, 2007 at 9:05 AM (PDT)

12

josh: I agree with you.  How are they going to get people to give up their iPods, if only 3% of the music on the iPod is from the iTunes store?

Posted by otaku on October 12, 2007 at 9:06 AM (PDT)

13

Another thought. Why not have Apple get directly into the music biz and sign the artists directly? Apple has the global reach, and marketing tool (iTunes). Apple can keep a larger share of the profits as can the artists. The record companies will die a slow, painful and welcomed death.

Posted by Don Trammell on October 12, 2007 at 9:23 AM (PDT)

14

I wonder.  The recording industry, led by Universal and Sony, created PressPlay, a subscription music service back early in the decade (http://en.wikipedia.org/wiki/Pressplay)

I had a subscription before the iTunes store came out on Windows.  In 2003, Roxio acquired the startup and also acquired the Napster name and that’s where the Napster subscription music store came from.

I guess what I’m saying is - they weren’t successful at this before with the exact same groups - that’s what led to iTunes in the first place.  Then they sold that off and it still wasn’t successful against iTunes when iTunes started.

I think what they should be considering at this point - what’s changed?  Do they think they can have a better chance against iTunes now that they’re a much larger force?  Maybe they think they do if they can work together to pull their music out of iTunes and work like a puppeteer to help out Apple’s rivals, but I would think that would be illegal - collusion.  Besides that, it seems like they’re taking an awfully large risk and losing money in the process.

Posted by Jeremy on October 12, 2007 at 9:24 AM (PDT)

15

*.mp3 is a standard. It plays on iPod and all other players.

LPs, CDs, DVDs are standards and play on players who compete to provide the best quality, however interpreted: audiophile, et al

The music industry is proposing that music be licensed to a piece of hardware (player) similarly to the way computer software is licensed to a device mac address.

Where’s the value for me? What happens if I “upgrade” to the coolest new Denon device, I have to “buy the White album again”?

Fortunately I believe the “market” will squash this idea. (I’m beginning to think my baby boom generation is the stupidist lot to come along in years. We would never have bought this kind of crap from the “establishment” in our day.)

Posted by DrakeBullet on October 12, 2007 at 9:37 AM (PDT)

16

Gotta say that I love watching The Office for free on the NBC website.  So that’s been a plus of their little tiff.

Posted by superape on October 12, 2007 at 9:56 AM (PDT)

17

Is anyone at Universal familiar with the concept of collusion or restraint of trade?

Posted by davidwb on October 12, 2007 at 10:36 AM (PDT)

18

It’s not just Apple the big music labels are after. Is it any wonder why artists are dissatified so much with these big labels that they will leave them and are willing to give their works away, like Oasis, NIN.

Posted by will_bc on October 12, 2007 at 11:06 AM (PDT)

19

Don Trammell,

Sound like a good idea if Apple started their own label. One problem… Apple Corps. I hear they had a long and drawn out tussle with them about Apple infringing on their turf.

I don’t think Apple wants to go round 3 with them unless they just buy them outright (if Corps is a public company)

Posted by will_bc on October 12, 2007 at 11:14 AM (PDT)

20

iTunes is not perfect, but it’s the next best thing.  Deal with it.

Posted by Craig on October 12, 2007 at 11:17 AM (PDT)

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