Apple considers selling devices with unlimited iTunes access

by Nikki Sandison, Brand Republic 19-Mar-08, 09:15

LONDON - Apple is talking to the big music companies about giving customers unlimited access to the entire iTunes library in exchange for paying a premium for its iPod and iPhone devices.

The new business model would be similar to Nokia's "comes with music" deal with Universal Music last December.

Negotiations are said to rest on a dispute over the price Apple would be willing to pay for access to the music labels' libraries, according to the Financial Times.

Nokia is said to be offering music industry partners almost $80 (£40) a handset, to be divided according to their share of the market, while Apple has so far only offered about $20 a device.

One executive told the Financial Times that consumers would pay a premium of up to $100 for unlimited access to music for the lifetime of the device or a monthly fee of $7 to $8 for a subscription model.

Apple is thought to make a relatively small amount of money from its iTunes store compared with its hardware sales.

The move could help drive demand for a new generation of Apple's hardware as well as providing a boost to the struggling record industry.

Apple is also said to be considering a subscription model where it has a monthly billing relationship with its customers through the mobile phone operators. The drawback with this is that it would only work with iPhones, while the "comes with music" model would work with iPhones and iPods.

Comments

alex parr - 19/03/2008

it's interesting and could surely be great, if only it wasn't for apple's heavy hand with DRM on tracks. i'm not one for file sharing bu i wouldn't want to have all my tracks lost when teh device goes. i know people that have had similar problems with the subscription model in that when you cancel you lose access to your entire collection (no names, virgin, ahem). If apple addressed this then it'd be great!

Hannah Lines - 19/03/2008

Alex I think you're missing Apples point of implementing DRM on all tracks. Fair to say that it would be better to have all these tracks forever - Sadly this is just a nifty tie-in.