According to The Financial Times, Apple could be planning a radical restructure to its business model around both the iPod and iTunes businesses. The FT states that Apple is deep in talks with the major labels to offer an all-you-can-eat model for music for consumers that buy an iPod, so the music would be available for free for the lifespan of the hardware.

Already championed by Nokia in a deal with Universal, the model means the consumer will play a supplement for the hardware but nothing extra for music from iTunes thereafter. The sticking point seems to be the amount Apple is willing to pay per device. The FT reports that Nokia pays $80 per device, while Apple is sticking at $20 per device as an offer to the labels.

The other interesting wrinkle could be the roll out of an iTunes subscription model, which would most readily apply to the iPhone. The billing relationship is already in place through the operator, in the UK it’s O2. It would be a blessing in some respect for subscription players such as eMusic and Napster but of course the conflict of DRMs for consumers would mean only a limited uplift for non-iPod services and players.

Advertisements