Universal Thinks Consumers Are iDiots

Have you heard about Universal Music’s new Apple-killing idea to make consumers pay a monthly fee for free music (pay and free don’t go in the same sentence real well)?

According to Business Week: “…insiders say [Universal head Doug] Morris & Co. have an intriguing business model: 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”.

So let me get this right? The hardware makers or cell phone manufacturers bury the cost of what basically is a subscription service and all these young kids who have taken down the record labels run out and buy these un-cool devices – and presumably forsake their iPods.

(I can hear you saying, how can Jerry know that these devices will be un-cool, they haven’t even made them yet).

Let’s start with the proposed name of the service – Total Music.

That’s about as bad as Microsoft naming its iPod a Zune or more recently naming the Zune social network – Zune Social. C’mmon. All you have to do is have kids to know this is as un-cool as Barry Manilow.

Now don’t hyperventilate when you read this description of Total Music courtesy of my friend Vytas Safroncikas of Born Again Radio:

“With the Total Music service, Morris and his allies are trying to hit reset on how digital music is consumed. In essence, Morris & Co. are telling consumers that music is a utility to which they are entitled, like water or gas. Buy one of the Total Music devices, and you've got it all. Ironically, the plan takes (Steve) Jobs' basic strategy-- getting people to pay a few hundred bucks for a music player but a measly 99 cents for the music that gives it value--and pushes it to its extreme. After all, the Total Music subscriber pays only for the device--and never shells out a penny for the music. "You know that it's there, and it costs something," says one tech company executive who has seen Morris' presentation. "But you never write a check for it."

Total Music could then become a streaming radio station or allow individual songs to be downloaded like Yahoo Music.

This could be so good. The killer app! Giving Steve Jobs his comeuppance. A whole new beginning for record labels.

Then, I woke up.

Universal must be kidding.

Jobs gets the next generation (and their parents, baby boomers like him) to shell out substantial cash for his products because they are not designed to fool consumers into thinking it is one thing while they are paying for another.

Doesn’t anyone get it yet?

The iPod is a portable record player – okay, you forced me to use the words. Record player. Except, an iPod is even better. And you don’t always have to buy music for it.

While I am on the topic of buying music, the next generation never worries about this because they can find almost anything for free online. (Please re-read that last sentence).

When they buy from Apple’s iTunes store it is because it is convenient, seamless and they want to. But they don’t have to.

Universal alert: consumers don’t have to buy music to own it. Therefore, they don’t have to buy one of your “record players” disguised as a mild-mannered reproducer of music for which you really want them to pay.

As they would say in the British Parliament, “I refer you back to the right honorable gentleman from Hoboken, New Jersey” – that’s me!

Record labels don’t have to connive, mislead, threaten or bully their customers.

Just lower the price of legally downloaded music. As I have written before in this space – make a song the price of a text-message and you will do a land office business.

Still don’t believe me?

How would you like to add the cell phone carriers’ profit for something as simple as text messaging to your bottom line.

Back to the drawing board.

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