More blood on Apple iTunes Store’s play button: Yahoo shutters online music subscription service

“Yahoo Inc. will cease operating its online music subscription service and switch its customers to RealNetworks Inc.’s Rhapsody music service as part of a new deal between the companies that calls for Yahoo to promote Rhapsody on its site,” Alex Veiga reports for The Associated Press.

“Under the Yahoo-RealNetworks partnership, subscribers to Yahoo Music Unlimited will be shifted to the Rhapsody service sometime in the first half of this year. Yahoo subscribers’ music library and payment plans will remain the same for a limited time after the switch, but those wishing to remain on Rhapsody eventually will be required to sign up at Rhapsody’s rates,” Veiga reports. “Yahoo’s subscription rates range from $5.99 a month, if users pay for a full year in advance, or $8.99 a month. Rhapsody memberships start at $12.99 a month.”

MacDailyNews Take: Ah, the beauty of subscriptions; they always seem to go up.

Veiga continues, “Yahoo executives declined to say how many subscribers their music service has. Rhapsody has 2.75 million subscribers worldwide, including customers signed up for its premium radio and mobile music services.”

Yahoo “management said last fall it had begun to de-emphasize its subscription model in favor of an advertising-supported music service,” Veiga reports.

Full article here.

[Thanks to MacDailyNews Reader “d-in-stereo” for the heads up.]

Jon Healey reports for The Los Angeles Times, “The deal leaves Rhapsody, Napster and Microsoft’s Zune Pass as the last subscription services standing, with Zune Pass being available only to consumers who buy a Zune MP3 player. Previous casualties include MTV’s Urge, AOL’s MusicNet, Sony Music and Universal Music Group’s Pressplay, and Circuit City’s MusicNow. Put another way, some of the biggest names on the Web, the music industry and electronics retailing have ventured into the subscription music market, only to be forced into retreat.”

“Ian Rogers, Yahoo’s vice president of video and media applications, illuminated one of the central problems for subscription services: They’re too complex technologically for most consumers. The electronic locks used by subscription services make them incompatible with iPods, the most popular MP3 players on the planet. That’s strike one. The locks also make it difficult to move music around the home, given how few stereos or boom boxes can support them. That’s strike two. And even the portable players that are supposed to be compatible with subscription services can run into trouble handling their complex software, resulting in freezes, resets and other maddening malfunctions. That’s strike three,” Healey reports.

“Most music fans want something tangible when they buy songs. Subscription services, however, are like cable TV: They sell access to entertainment, not packaged goods. And like cable, they’re not easily portable, which is a real problem when it comes to playing music in a car. It would be a different matter if people were continuously connected to the Net and could hear any song they wished, anywhere, any time. But in the current circumstances, music subscriptions work best as ways to sample music — not as a substitute for buying it,” Healey reports.

Full article here.

[Thanks to MacDailyNews Reader “Dave” for the heads up.]

Rhapsody is turning out to be the dumping ground for Apple’s roadkill.

20 Comments

  1. Reality:
    “The deal leaves Rhapsody, Napster and Microsoft’s Zune Pass as the last subscription services standing, with Zune Pass being available only to consumers who buy a Zune MP3 player. Previous casualties include MTV’s Urge, AOL’s MusicNet, Sony Music and Universal Music Group’s Pressplay, and Circuit City’s MusicNow. Put another way, some of the biggest names on the Web, the music industry and electronics retailing have ventured into the subscription music market, only to be forced into retreat.”

    Fantasy:
    “With the latest release, the big news is the introduction of movie rentals, but, disappointingly, music-subscription options like those offered by Napster, Rhapsody, and other Windows Media-based services are still nowhere to be found,” Muchmore and Broida report.

    That leaves much more to the imagination. Discuss.

  2. Subscription services are a license to steal content without compensating the artists fully.

    1: Subscribe to subscription service and load up hard drive with toons.

    2: Use a stereo mini output to input cable to another PC and record everything into Mp3.

    3: Chop, tag and bag. P2P to all your friends.

    Apple likes the artists, it sells hardware to them. They think subscriptions screw them so they don’t offer it.

    But the labels do sign deals involving subscriptitions, so the labels are screwing the artists.

  3. Hey, I think that a subscription service has a place in this world. Some people like mega music (not listening to, just having access to ” width=”19″ height=”19″ alt=”grin” style=”border:0;” /> ).

    And since for subscription its really like FM radio only programable, you buy a cheap Zune (oooppps those don’t work forget I said that ) or MP3 player for your subscription work and an iPod for music you own. That way, everyone is happy. ” width=”19″ height=”19″ alt=”grin” style=”border:0;” />

  4. The funny part is that I bet Apple is the only company that could actually be successful running a subscription-based service. That’s because they have all the pieces in place, whereas the other players only control this piece or that piece. Apple has done it right from the start.

  5. Subscriptions are like little holes in your income bucket. Month in and month out they drain money, offsetting your income. They seem so harmless: a few bucks here, a few bucks there. But pretty soon you find that a pretty sizable chunk of your income is already spent. Drop all your subscriptions and buy the mags or music when you really want them. You’ll be left with a lot more coin in your pocket at the end of the day.

  6. “And even the portable players that are supposed to be compatible with subscription services can run into trouble handling their complex software, resulting in freezes, resets and other maddening malfunctions.”

    It’s not the DRM on the songs that cause this, it’s crappy software running the damn thing!

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