(Via Ars Technica) BusinessWeek reports that Universal Music is looking to compete with the Apple iTunes music store by offering a music subscription service called Total Music. From the reports, it seems that Universal is looking to explore different business models, such as using hardware makers or cell carriers to subsidise the subscription fee, and allowing the user to download unlimited amounts of music. It appears that affiliated companies would have Total Music offered as a bundle with their product, increasing the value of the product (and possibly the price) and moving more units.

I would like to know more about how the products and the subscription service would be priced in Australia and what part DRM would play (preferably no part). I would also be interested in finding out if the subscription service would be a service in its own right- or only available with certain products. It seems that there is some interesting potential here for reviving music sales and a very real threat to Apple if this gets off the ground.

Labels: abi, business models

Radiohead's seventh album "In Rainbows" will be released in a couple of days and what really has people buzzing about it is the fact that it's left up to you to decide how much you want to pay for it. The album will be available for digital download exclusively through Radiohead's website. The price field is left blank for you to complete. When you hit the '?' button the website tells you "It's up to you" clicking '?' again leads to the site urging, "No really, it's up to you".

While this isn't the first time an artist has made their music available for free legal download on the internet it is the first time that I am aware of successful artists asking fans to pay what they want for their music (although this is somewhat similar to honesty box policies on donations). The digital download will be available months before the physical discbox (for 40 pounds you get vinyl records, enhanced CD with extra sounds, artwork and other extras). I have always supported looking at different business models to deal with IP. The diehard fans will definitely purchase the discbox, supporters will throw in a couple of dollars. This might work for an established well-respected band like Radiohead but how would disposable pop fare? Earlier this year Nine Inch Nails criticised their record company for selling their album for much more money than other newly released music in Australia (e.g. $34.99 versus Avril Lavigne at $21.99) because their core audience will pay whatever it costs to own their latest record (whereas some pop has to be discounted to sell units). In September, at a concert, after discovering that prices had not changed the band ushered fans to "STEAL IT. Steal away. Steal and steal and steal some more and give it to all your friends and keep on stealing. Because one way or another these [bleep]s will get it through their head that they're ripping people off and that that's not right." (Read more on NIN in this post on Defending Scoundrels). It would appear that Radiohead's proposal is fairer for fans because at least they are given a choice about what premium they will pay. A ‘pay what you want’ system might even get the best artists floating to the top.

Radiohead will be boosted by the extra publicity- but will others follow suit? We will also discover some interesting things about how consumers believe music should be priced. At the very least, it seems that more people will have copies of this album increasing the market for future tours and other merchandise and products.

If this is the IP revolution- sign me up!

Labels: abi, business models