All-you-can-eat iTunes--why not?

Going against conventional wisdom, I think Apple will soon introduce a subscription-based music and video service. Although music-subscription services have been in the digital music rotation for years now--and with relatively low success--Apple has repeatedly shunned this still intriguing distribution model for its iTunes Music Store. But the digital music space is still young, and as competition from the likes of WMP 11 and Urge heats--or, rather, warms--up, I believe Apple may shock us with its own bulletproof version of an all-you-can eat iTunes club. And consumers will lick it up.

Steve Jobs time and again has stated that people want to own their music. Take, for example, this excerpt of an interview in Rolling Stone in December 2003:

These [music-subscription] services that are out there now are going to fail. Music Net's gonna fail, Press Play's gonna fail. Here's why: People don't want to buy their music as a subscription. They bought 45s; then they bought LPs; then they bought cassettes; then they bought eight-tracks; then they bought CDs. They're going to want to buy downloads. People want to own their music. You don't want to rent your music--and then one day, if you stop paying, all your music goes away.

And you know, at 10 bucks a month, that's $120 a year. That's $1,200 a decade. That's a lot of money for me to listen to the songs I love. It's cheaper to buy, and that's what they're gonna want to do.

At a press conference in April 2004, Jobs again dissed subscription services: "The subscription services are not succeeding… People want to own their music, not rent it."

Curiously, at the same event, on the topic of watching video on an iPod, he stated: "One of the things we say around Apple, and I paraphrase Bill Clinton from the 1992 presidential race, is 'It's about the music, stupid.' Well, not only is the 5G iPod with video considered the best iPod to date; we've all pretty much penciled in a late-2006 arrival of the heavily rumored true video iPod and perhaps even a deal with the movie industry. New content appears on iTunes' video section on a near daily basis, with the latest being NBC News' programming and NHL hockey."

We've seen Steve Jobs flip-flop on ideology before. He used to describe flash-based players as "tchotchkes"--toys. The Nano and the Shuffle now make up five-sevenths of the current iPod lineup. While subscription services have struggled to capture the hearts and wallets of the masses, the infrastructure and the standards for operating a service are ready to go. While not everybody will warm to the idea of renting songs, the time is now for users to accept the subscription model as one of the many options for consuming music.

Music-subscription services first arrived on the scene in earnest in late 2001. MusicNet and Pressplay were the two industry-supported juggernauts. These systems failed less for their technical problems and more for their arrival at a time when free downloading was in its heyday. Consumers and reviewers alike simply hated the restrictive and confusing usage rules placed on tracks.

Modern subscription services have fared better, thanks to larger music catalogs, lower prices, increased broadband penetration, and special features, such as the ability to transfer tracks to portable devices. Although Napster has seen its share of disappointment, it does have more than 600,000 subscribers, along with a relatively new Web-based service that gives users free on-demand streams. Yahoo Music Unlimited ($6.99 per month) and Virgin Digital ($7.99 per month) both offer services for dirt cheap, and Rhapsody is a favorite of the critics. Now, with Microsoft-supported MTV Urge in the picture--as part of the tightly integrated and vastly improved WMP 11--along with promises of more bulletproof technology, such as PlaysForSure 2.0, the time for wider acceptance of subscriptions is now.

Why should Apple, which dominates the digital hardware and download market, bother with such a world? Competition. As competitors offer more and more features, Apple has the luxury of picking and adding the ones that work, though iTunes' feature set is thin for a modern jukebox (but maybe simplicity works), the Windows version needs improvement, and the current streaming-radio feature needs a major upgrade. It's using dated technology, and though you can hear lots of good stuff, there isn't an ounce of interactivity or modern algorithymic benefits of streaming radio that Rhapsody and others have perfected. One thing that a subscription service offers is discovery, whether it's from customizable radio stations à la Rhapsody, professionally programmed playlists à la Urge, or deeply rooted community interaction of Napster or Yahoo.

Imagine a subscription-enabled iTunes 7 with all-you-can-stream access to more than 3 million tracks for $10 month. You'd also be able to compile playlists manually or automatically using a mix of your own songs and the entire iTunes catalog. You could actually fill up a 60GB iPod with the click of a button. You'd still have the option to buy tracks, perhaps for less than 99 cents. As a subscriber, you'd get access to videos and maybe even movies for a few bucks more. Of course, you'd have to get the newest iPod, equipped with an internal subscription clock.

I can't believe that in five years, Apple won't have a subscription service. The company has taken note of the problems on the WMA side, plus it has the advantage of controlling both the hardware and software sides of the subscription equation. The time is now for an easy-to-use, utterly convenient, and cheap subscription service from Apple.