Universal Music Group plans to introduce a new business model to sell free music online, which could challenge the dominance of Apple's famous iTunes.
According to BusinessWeek, the plan is to have companies subsidize the cost of the subscriptions, estimated at five bucks a month. Wireless carriers could offer unlimited music on their cell phones, for instance, and simply build the cost into the monthly fee. Hardware makers who sell "Total Music"-branded devices could build the cost into the price. To consumers, the devices all appear to come with unlimited free (and legal) music from the biggest acts in the business.
The move from Universal Group could be revolutionary, considering that the payments for the service come via purchasing the hardware. While there are issues regarding DRM that are yet completely addressed, the service is a sign that the music industry is finally finding ways to monetize the open model on the Internet.
Apple, which was once contemplating a buy-out of Universal (Register), has recently had a fall out with music record labels, including Universal.
Universal planning free music service (Sci-Tech Today)