Universal Music Group takes on iTunes with Total Music subscription service

Katherine Hannaford Digital Music Leave a Comment

fighting-grandads.jpgThe Universal Music Group has been making it known for some time that they’re deeply unhappy with Apple’s iTunes service, with UMG’s Doug Morris and Apple’s Steve Jobs fighting with handbags more often than not.

Morris recently refused to sign up for another contract with Apple allowing their record label’s music on iTunes, due to their strict contract terms which apparently limit the company’s marketing and the fact that Apple takes 29 cents of every 99 cents paid per song owned by UMG. Instead of pulling out of Apple altogether, UMG have decided to launch their own online music store, Total Music, and are joining forces with other labels such as Sony BMG and Warner Music Group, together owning 75% of all music sold in the US.

Together they hope to take on iTunes and re-establish control of all their music, as well as work more with the Microsoft Zune and Sony Playstation, to move the market away from the iPod as much as possible.

The big record labels involved in Total Music would be able to offer a wide range of music tracks to users on a subscription-only basis, and hope that hardware makers (such as Microsoft with their Zune) or mobile carriers absorb the $5 per month subscription fee, so all consumers would have to fork out for would be the device. Hardware makers would sell more players, with the music companies collecting the subscription fee from the manufacturers, thus the up-front cost of a device is the only charge the consumer would see.

UMG is yet to pull their music from iTunes, and only time will tell if they separate entirely from the music giant, or launch Total Music to complement iTunes. If Total Music succeeds, it wouldn’t be hard to see all the major record labels pulling their tracks from iTunes completely, but a brief glance at history shows when other music companies have tried this in the past, they’ve failed dismally.

(via Business Week)

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By Katherine Hannaford | October 16th, 2007