Universal Plans Total Music Anti-iTunes Initiative With Free All-You-Can-Eat Music

Illustration for article titled Universal Plans Total Music Anti-iTunes Initiative With Free All-You-Can-Eat Music

Not only is Universal not signing multi-year contracts with Apple, it is now creating a service to confront iTunes and nurture iPod competitors like the Zune. Called Total Music, it may include Universal, Sony BMG and Warner—75% of music sold in the US—and would offer a twist on the traditional download and "PlaysForSure" subscription concepts. When you buy a Total Music-supported MP3 player, you would essentially get free all-you-can-eat music.

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According to BusinessWeek, it works like this:

[Total Music will] get hardware makers or cell carriers to absorb the cost of a roughly $5-per-month subscription fee so consumers get a device with all-you-can-eat music that's essentially free. Music companies would collect the subscription fee, while hardware makers theoretically would move many more players.

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The downside as I see it is that this is clearly not a move away from DRM, but towards more of it. You can bet those downloads are going to be wrapped thicker than a 5-year-old's Christmas present, though Universal is still pursuing a test run of DRM-free sales with Wal-Mart, Google and Best Buy. [BusinessWeek via BB Gadgets]

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DISCUSSION

Another problem is that, say they get Sony and MS and maybe a couple of other hardware makers on board. Now, MS *cannot* afford to tack on an extra $90 ($5 * 18mo) to all of their Zunes... there's no way they can compete with iPods now because of the perceived price difference is going to be outrageous. I mean MS is probably pushing it to their limits right now by equalling the price of their HD based Zunes with their iPod counterparts.

So, they would have to sell another line of Zunes, with the $90 more price tag to those people who want to use this subscription service. Then, they would have to make changes in the hardware so that those Zunes would work with the service but not the cheaper ones.

Not only would that make the hardware lineup a mess (Zune 2 80GB Normal, Zune 2 80GB Ttotal Music, Zune 2 8GB Normal, Zune 2 8GB TM, etc.), it's going to limit the potential market of Total Music from the get go. I mean, Zunes have a fraction of the DAP market (like 3%?). And how much of the Zune TM are there going to be? Even if half of the future Zunes become TM, that's 1.5% of the market. And that's from the single largest iPod competitor!