“Consumers want to buy music, not rent it, and a big part of Steve Jobs’ genius is his firm, intuitive grasp of how consumers behave, and tailoring Apple’s technology to accommodate it — not the other way around,” Kahney writes.
Kahney writes, “Nonetheless, there’s a lot of speculation that Jobs may soon offer subscriptions, mostly because he’s currently renegotiating contracts with the record labels, which love subscriptions because of the steady, predictable revenue stream.”
“I just canceled my subscription to Microsoft’s Zune service after about three months as a subscriber. I finally realized that I’ll never change my music-consuming behavior to fit its business model,” Kahney writes.
Kahney writes, “Like all subscription services, Zune is analogous to a cheap Vegas buffet. At first you stuff your face like a pig, but when you go back, there’s nothing you want to eat. After an initial burst of activity where I downloaded everything I could find, my usage dropped off a cliff.”
“I thought the Zune subscription service would be good for finding for new music, but it isn’t at all. I’ve found more music from TV ads than I found through Zune,” Kahney writes.
Full article here.
Oh, so that’s who bought that Zune!
As we wrote as recently as last week: Business models that fly in the face of human nature are doomed to failure.
Human beings like to listen to favorite songs over and over. They like to own these songs, so that they can play them over and over. They do not want to pay someone an unending monthly rate in order to be allowed to hear their favorite songs.
1,000 excellent songs costs $990 (or $1290 for DRM-free, higher-quality EMI songs) for life, but to listen to them with a $9.99/month subscription plan for 10 years would cost $1199, for 20 years it’d be $2398, $3597 for 30 years, $4796 for 40 years, and so on – and that’s not even taking inflation into account! That subscription rate is going to increase over time, but once you buy a song, you own it for life at the price at which you purchased it — your deal gets better over time, not worse.
Now, for the limited amount of people for which a music subscription service would be welcome, we say, by all means, Apple should offer it – if it makes business sense (i.e. development and operational costs are less than profit potential).
Regardless of what happens, the fact remains: The labels want subscriptions to succeed because they dream of a recurring revenue stream, not because music consumers desire such a service. We can almost hear the greedy bastards in their music cartel boardrooms, “If only we could get them on subscription plans, if only we could get them on subscription plans…” Dreams of easy cash do not a successful business model make.
One more time: Business models that fly in the face of human nature are doomed to failure.
Now, for TV shows and movies, a subscription service makes perfect sense because it better fits the way people consume those types of content than does outright purchasing. Not to mention, where do you store all of that content that you own, but are only going to watch once or twice? Most people can count that number of movies they’ve watched three or more times on their fingers.
We want to buy our music and subscribe to a TV shows and movies plan via Apple’s iTunes Store.