Rented music may seriously threaten iPod

By Derek Sooman on February 8, 2005, 11:12 AM
New copy-protection software from Microsoft may help to move consumers away from buying songs by the track, and instead into renting them. The new software works by putting a timer on the tracks loaded on the player. Every time the user connects the player to the PC and the music service, the player automatically checks whether the user's subscription is still in effect. Songs stop playing if the subscription has lapsed. Many experts believe that if lots of music players that support this technology spring up, it could cause serious problems for iPod.

"This is potentially the first serious challenge that the iPod is going to face. What these devices are going to be able to do is attack iPod where it's weak." - Phil Leigh, president of Tampa, Florida-based Inside Digital Media.

Clever use of marketing will be paramount in winning customers over to paying a monthly fee for music, like they might do for cable television programming, rather than buying music in the way they are used to. But the business model is becoming a realistic one, and it could soon take off with the proper backing.

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