Subscription Savior to Obsolete iPod?

by Chris Howard Sep 05, 2007

There was a very interesting piece in The New York Times this week about Rick Rubin, co-head of Columbia Records. He is not your average record industry executive, looking more guru or Christ-like than industry saving mogul. So his thoughts on music subscription seemed out of character. Maybe he is starting to become a more mainstream record label mogul.

Rubin must have been reading the Microsoft play-book. He’s come out with a classic bit of FUD suggesting not only that subscription is the way of the future for music distribution, but that it will signal the end of the iPod. The rest of the article made compelling reading and portrayed a square peg in the round hole of the music industry. But for some reason, Rubin had a brain-freeze over music distribution, toeing the corporate line.

The article says:

Rubin has a bigger idea. “...the future of the industry is a subscription model, much like paid cable on a television set. You would subscribe to music,” Rubin explained. “You’d pay, say, $19.95 a month, and the music will come anywhere you’d like. In this new world, there will be a virtual library that will be accessible from your car, from your cellphone, from your computer, from your television. Anywhere. The iPod will be obsolete, but there would be a Walkman-like device you could plug into speakers at home. You’ll say, ‘Today I want to listen to…Simon and Garfunkel,’ and there they are… And once that model is put into place, the industry will grow 10 times the size it is now.”

I’m not sure how a “Walkman-like device” is so much different from the original Walkman’s natural descendant, the portable music player, of which the iPod is king and will remain no matter what method is used to get music onto it.

If subscription music takes off, the dominant player in this new market will still be a little thing called…iPod. Apple has the best and most popular catalog of music, so is best placed to take advantage of subscription music if it should ever become the preferred delivery system.

If subscription is the future, that doesn’t affect people buying iPods. iPods are simply a music storage and playback device. Unless, of course, Rubin plans on some proprietary system that locks subscribers into specific players. (Now we Apple fans need to be careful before calling the kettle black, as Apple is not adverse to systems that lock people into its products and services.)

But I doubt he does. He almost sounds like he is proposing a system with no limitations. Quite utopian and quite unlikely. But, I admit, I’d consider a subscription system with no limitations that I could access anywhere and download songs at will to my portable player without limitation or extra cost. As I said, utopian.

Curiously, Rubin is quoted in the very next paragraph as saying “The subscription model is the only way to save the music business. If music is easily available at a price of five or six dollars a month, then nobody will steal it.” So he’s gone from $19.95 a month down to five or six dollars. That’s quite a difference and you do wonder how anyone could make money if we had unlimited access for $6 a month.

All or nothing
Another big problem with subscription, and one Rubin acknowledges, is that you have to get all labels on the same service. People don’t want to have to subscribe to two or three services, as that suddenly becomes $40 or $60 a month. Imagine if you went into a major CD retailer and were told, “Sorry, we only stock Universal and Warner.” And what if there wasn’t a store near you that stocked a label you wanted? How inconvenient and annoying.

It’s not so bad if an online seller, such as iTMS, doesn’t stock a particular label, because going to another store online is much easier—except of course for player-specific DRM, although that’s not so hard to get around.

iTMS could yet lose Universal, but it wouldn’t hurt iTMS as much as a subscription service losing a major label.

Subscribing to music isn’t the same as subscribing to pay-TV
In Rubin’s dream world, as he says, he also sees subscribing to music as being the same rationale as subscribing to pay-TV. But that comparison is fallacious.

Now I don’t listen to a lot of music, but I checked on iTunes, which keeps a count of how often you listen to songs, and I have dozens of songs with play counts of over 10 listens, with my highest number at 59. (Yes, I know there’ll be a few chortles out there as many of you probably make those numbers look like I never turn my iPod on.)

Interestingly, at number one on my list with those 59 listens is Forever Lost by The Magic Numbers. I also have the music video for that song. Yet I have watched it only a couple of times.

As those numbers reflect, we just don’t consume music the same way and in the same volume, as we do video/movies/TV. That is why we like to own our music—because we use it so often.

Although we do buy movies, and in record numbers since DVDs took over from video cassettes, who can say they’ve got dozens of movies they’ve watched dozens of times? Anyone? Anyone at all? With movies, we tend to buy our favorites and rent the rest. With music, we just buy (or pirate) once and use infinitely.

If music subscription worked, why not implement it through normal CD means? That is, for $20/month you can walk into the music shop and have as many CDs as you like. Even if you could cut the cost of getting the CDs into your hands, it still sounds ridiculous. So immediately logic says to put restrictions in place. And consequently it loses its appeal.

Rubin is mistaken when he compares pay-TV to subscription music. Well, I hope he is! With pay-TV, you watch once. You don’t have access to the content to watch as often as you like. You can’t program what’s on pay-TV.

Even with a music subscription model, you have the say on what you access and listen to. And you can legally download the music for later repeated listening.

If Rubin’s music subscription model really is akin to pay-TV, then that’s simply pay-radio. That’s already available and hardly taking the world by storm. And it exists not to benefit the music listener, but to get around FCC restrictions and censorship. The music is secondary.

I’m not about to say the iTunes model is best, as it has its own limitations, although they are easily circumvented. The best model is and always has been the purchase of music on CDs (and before that, cassettes and vinyl). Full, unrestricted ownership.

Ironically, Rubin’s own partner in charge of Columbia, Steve Barnett, is skeptical of the subscription model, saying that “Smart people have told me if the subscription model is not done correctly, it will be the final nail in our coffin. I’ve heard both sides of the argument, and I’m not convinced it’s the solution to our problems. Rick wants to be a hero immediately. In his mind, you flick a switch and it’s done. It doesn’t work like that.”

Until a model comes along that offers us the same ownership and freedom over our music, the music industry will not find its savior. No matter how much the messenger looks like one.

Rubin’s final comment is, “The music will outlast us all.”

Unless, of course, your subscription expires. wink


  • I high quality digital download is worth $4.99 per album. That is what it is worth. No more and maybe a little less.

    When the record industry grasps this simple fact, they well make money!

    Rube Goldberg schemes will not save them!

    $4.99 ....  $4.99 ....  $4.99 ....

    pds6 had this to say on Sep 05, 2007 Posts: 1
  • “. . . we just don’t consume music the same way and in the same volume, as we do video/movies/TV. That is why we like to own our music—because we use it so often.”

    You’ve hit the nail right on the head.  Even if a subscription allows me to listen to a million different songs, it will be a cold day in hell before I plunk one dollar for a music subscription.

    My standing proposal is the following system:  If you purchase X dollars of songs a month, then you get one month’s free subscription to the whole catalog.  No not 30 second excerpts but the whole song.  Here are the benefits:

    1.  The free subscription would lure would-be pirates into purchasing the songs legally to get access to the catalog.

    2.  This access would allow customers to sample complete songs, giving them a costless way to push their musical envelope, leading them to purchase songs that they would normally not have bought if they only heard the 30 second excerpt.

    3.  A barrier to exit is a barrier to entry.  The ability to easily turn on and turn off the subscription might actually attract more combined subscription hours than if people had to sign up for a one year stint.

    I should patent this idea. Yeah, right.

    tundraboy had this to say on Sep 05, 2007 Posts: 132
  • <i>the future of the industry is a subscription model, much like paid cable on a television set… You would subscribe to music. You’d pay, say, $19.95 a month, and the music will come anywhere you’d like.</i>

    No, I will not.

    I will buy my music and store it forever more and convert it to play anywhere according to ethical standards not decided upon by corporations with vested interest. I will not pay for stupid, extortionate, exploding-DRM subscription services. Ever.

    These bastards have a simple choice: our way, or the highway. They can sell fair products to the vast majority of us. Or they can try to sell draconian overpriced systems to a small minority while the rest turn to piracy.

    In the end, the result is the same.

    Benji had this to say on Sep 05, 2007 Posts: 927
  • For us.

    Benji had this to say on Sep 05, 2007 Posts: 927
  • That’s cool, Captn. Maybe subscription is why the Zune has struggled.

    Ok. One of the reasons. smile

    Chris Howard had this to say on Sep 06, 2007 Posts: 1209
  • <i>iTMS could yet lose Universal, but it wouldn’t hurt iTMS as much as a subscription service losing a major label.</i>

    Hmm? Just thinking. I guess that’s why the labels prefer subscription. i.e. it gives them more power over the provider.

    Chris Howard had this to say on Sep 06, 2007 Posts: 1209
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