updated 10:55 pm EST, Tue March 28, 2006
Subscription music plan
Yet another music service plans to offer a flat-fee monthly pricing model as a way to lure more customers. Sprint Nextel said it plans to boost its mobile music business this year with a new subscription scheme for downloading songs onto cellphones, and expand its partnership with Sirius Satellite Radio, according to Reuters. As the first mobile operator to launch a mobile phone music service -- something many analysts believe could cut into the industry leading Apple's iTunes Music Store, Sprint currently offers its songs for $2.50 each and reaches over 1 million users. Verizon and Vodafone followed suit with a competing service in January of this year. In move that could foreshadow the same by iTunes, Sprint said it hopes that the new subscription music service will increase demand and generate more revenue.
Online music services with similar subscription models have seen limited success with the monthly pricing model -- although Real recently said it had doubled its subscriber base to 1 million customers; however, Real and the growing list of iTunes competitors (Napster, Yahoo, Google, Amazon), are confident that consumers would rather pay monthly fees for access to a larger number of songs, although users will not retain the rights to songs after they leave the service.
"We think it would open up more demand," Sprint Chief Operating Officer Len Lauer told Reuters. Sprint had not yet released details on pricing.
Earlier this year, Yahoo! updated its own iTunes-like jukebox software to add many of the same features found in iTunes.