Original URL: http://www.theregister.co.uk/2008/03/19/apple_free_music_with_ipods/

Future iPods to come bundled with free iTunes access?

Music gratis, hardware more expensive

By Tony Smith

Posted in Hardware, 19th March 2008 11:41 GMT

Apple could soon offer an unlimited music bundle with future iPods and iPhones if the plan strikes a chord with the music industry.

Such a scheme might see the company adding around $100 to the price of the hardware to allow punters who selected that package to access the entire iTunes Store music library for free, for as long as they own the device.

The claim that Apple is pitching such a concept was made today in the Financial Times, which cited "executives familiar with the negotiations". The music labels appear interested but unsurprisingly want more than the $20-an-iPod the mole alleges Apple is offering.

The template for the deal is Nokia's 'Comes with Music' initiative, launched late last year. The Finnish phone giant said it will offer certain handsets with a year's free, unlimited access to its music library. It's not a true subscription: Nokia said users will get to keep tracks they've downloaded even if they decide not to subscribe for another year.

Nokia already has Universal on board, and the FT claims it's offering other labels up to $80 a handset to sign up. It's hoping to get Comes With Music-branded phones out in the second half of the year.

It's not clear how Nokia - or Apple for that matter - would sell the scheme, but whether the premium would be paid up front, hidden in the cost of the handset, or offered as a loss-leader, the consumer pays in the end. It's likely cheaper, music-less devices will continue to be offered.

Apple's iPhone and iPod Touch already allow users to download songs to their devices on a pay-per-track basis, a model that has proved the consumer's choice over subscription models, almost all of which involve losing your music if you don't continue to cough up.

Apple has always poo-poo'd such a subscription approach, but the Nokia scheme eliminates that key restriction to the traditional subscription model - handy now the music business is at last shifting away from DRM. Indeed, the FT's source claims Apple is even considering whether it should offer some kind of monthly all-you-can-eat music subscription.