The Speculist

The iPhone is another piece of beautiful engineering from Apple. When you pull it out of your pocket it looks something like this:

Then when you unlock it you see a screen like this:

The device is all screen. If you're watching a downloaded movie, it switches to landscape mode and the picture will use nearly the entire device.

It runs full Mac OS X - making it more a Mac for your pocket than just a iPod-cellphone. Apple is a master it seems at bringing out elegant products that are a pleasure to play with. It even uses my present cell phone provider - Cingular.

I'm very impressed. Almost impressed enough to actually buy one... But not quite.

The problem is not the device itself, but the iTunes $.99-per-song business model. When an all-you-can-eat musical buffet was suggested for iTunes, Steve Jobs famously said "People want to own their music."

With respect...no. People want to listen to music. And most people, including myself, want the freedom to explore music - to listen to everything the world offers and decide what they like. This is not really feasible for most people if they are paying per song.

What does it mean anyway when we say that we own music? It's a legal fiction. The meaning of music "ownership" for consumers has changed with the media.

If you were around "owning music" thirty years ago you owned vinyl records. If you wore the grooves out on some really good tune (or scratched the record or broke it) you didn't just show up at the record store and demand replacement vinyl for the music you "owned." Well, you could, but you'd get laughed at.

No, you bought the record again. In practice you only owned the physical record that contained the music. This gave you the right to listen to the music as long as the vinyl lasted. The record company owned the music.

This began changing when the capability came along to copy music with magnetic tape. Of course the record industry fought hard to have this technology outlawed. Fortunately, they mostly lost that battle. Magnetic tape technology brought the freedom to record backups. Legally people could put the backup or the original away for a spare, or they could use the backup cassette for the car while keeping the vinyl original for the turntable.

You could not legally sell your backups. You didn't own the music in that sense. The record companies retained that ownership. When people started ripping their CDs, the laws developed for magnetic tape were brought forward without much change.

Now music is incorporeal - distributed by Internet with no physical container like a record or CD. You would think that as with magnetic tape, this new technology would bring consumers additional freedom.

Well it can and does (more on that later), but not with iPod/iTunes. With the $.99-per-song/$10-per-album pricing structure, the power of the consumer is essentially what it was before. You buy the music and listen, but there's little freedom to explore. If you can't decide whether you like a song after 30 seconds, you don't even get to hear the whole song before purchasing.

But that's just part of the problem. Not all songs are equally valuable. Some songs are with you for a lifetime. You hear it when you're the right age or time and it becomes part of the soundtrack of your life. You'd happily pay $.99 or more for those songs.

Then there are songs you enjoy for a year...and songs you enjoy for a few months. And there are some songs that are interesting enough to hold your attention for a play or two, but then you're on to other music. Are all of those songs worth $.99?

Intelligent minds can differ on this, but my answer has remained "no." I enjoy being a musical nomad more than I admire the beautiful iPod and now the iPhone.

Like the super-buff jock or the nerd who can't imagine getting less than an "A" on any test, Apple has to be the best in one area - the digital device - to compensate for other deficiencies. Unfortunately those deficiencies are just too much for me.

Other services - Napster first, now Rhapsody - fit me better.

Napster allows you to fill a "Napster to Go" digital player for a monthly fee. You have to periodically plug the player into the computer so it can report your listening to Napster. Napster then pays the artists accordingly out of your monthly fee. This model is much like radio where artists are paid according to how often their music is broadcast.

Rhapsody's service is almost identical in structure, pricing, and music offerings. Ironically I only moved from Napster because I like the Rhapsody's Sansa digital music player better. But it still isn't as good as an iPod.

Sigh.

I suspect that Apple will maintain their $.99-per-song model as long as they can afford to. They will stick to what they have until they start losing significant market share to one of the streaming services. For the foreseeable future we consumers will have to choose between the best player with the iTunes model OR musical freedom with second-rate players.