THIS STORY HAS BEEN FORMATTED FOR EASY PRINTING

Apple mulls major shift in strategy for iTunes

Apple may offer a download deal with sales of iPhones and iPods. Apple may offer a download deal with sales of iPhones and iPods.
Email|Print|Single Page| Text size + By
Dow Jones Newswires / March 20, 2008

Apple Inc. is reportedly in talks with the largest music companies regarding changes to how it sells music through its popular iTunes service, changes that would amount to a major shift in the company's business strategy.

The changes could include offering unlimited and free song downloads in exchange for paying an extra fee when buying an iPod or an iPhone, according to a report in the Financial Times. The company also is reportedly looking at a subscription model similar to the type offered by rivals such as Rhapsody and Napster Inc.

Apple currently sells songs, albums, and music videos through iTunes with individual tunes costing 99 cents and entire albums typically starting at $9.99.

According to the Financial Times, the company is considering a service that would charge a premium on its iPods and iPhones but allow customers to receive unlimited music downloads for the lifetime of the products.

The service idea was said to be similar to the "comes with music" deal Nokia Corp. lined up with Universal Music Group in December. An Apple spokesman said that the company had no comment about the report.

IPods currently range from $49 for the iPod shuffle to $499 for a 32-gigabyte iPod touch player.

Apple is also said to be also exploring the option of a subscription model whereby customers would pay a monthly fee for song downloads. However, the Financial Times said the subscription model would only work with the iPhone.

"This would make a lots of sense from Apple's perspective," said James McQuivey, media technology analyst at Forrester Research. "Apple's had no real competition on the iTunes side of its business, but now Amazon.com is selling MP3s."

Services such as Rhapsody from RealNetworks Inc. and Napster currently offer subscription services that work with Windows Media-enabled music players, but not with the iPod - which accounts for the majority of the media-player market.

more stories like this

  • Email
  • Email
  • Print
  • Print
  • Single page
  • Single page
  • Reprints
  • Reprints
  • Share
  • Share
  • Comment
  • Comment
 
  • Share on DiggShare on Digg
  • Tag with Del.icio.us Save this article
  • powered by Del.icio.us
Your Name Your e-mail address (for return address purposes) E-mail address of recipients (separate multiple addresses with commas) Name and both e-mail fields are required.
Message (optional)
Disclaimer: Boston.com does not share this information or keep it permanently, as it is for the sole purpose of sending this one time e-mail.