Say bye-bye to Illegal music downloads?

Both Napster and Microsoft Music Service are working on new way to get customers to download music file to their iPod and otherportable mp3 players for less than $1 per song. Actually, significantly less. Both of these music service are working on a way allow customers to downloads as much music as they want as long as it goes directly to an iPod or similar portable music player.

This is great news for customers who still think $1 per song is too steep. Although the price model words for one song, 10 songs or even 100 songs, it starts getting outrageous when you go by factors of ten. If an iPod holds 10,000 songs and you want to fill it up, you would have to spend $10,000. Most people can fill up the iPod in less than a year.

Unfortunately, they probably won’t spend $10,000 on music, in any single year. So, what you could have is a legal product, the iPod, being used to hold thousands of illegal songs because the space is there. (assuming the iPod would be open later on to all mp3 formats.)

Napster has a workaround

Napster is the first to announce that it is working on a subscription model that would allow it’s user to pay a cheap subscription fee with no restrictions on how many songs they can download. By their estimates, a user can probably download 10,000 songs for about $180. Unfortunately, the Napster system does not work with the iPod so customers can only take advantage of this offer if they purchase either of two Napster approved portable mp3 players.

The Microsoft model would also allow customers to download a significant number of files for less than the average cost of $1 per song. Microsoft is another company that is also locked out of the iPod. They will distribute the songs via Microsoft approved portable mp3 players.

This new pricing model is radical change for the digital music industry. This came about because the success of iTunes has highlighted all that is good and bad about the ways music is sold online.

It shows that customers will buy online and they will browse through digital catalogs for individual songs rather than entire albums. But, it also shows that a lot of work needs to be done to make the mp3 security codes and portable players more compatible. If Apple continues to dominate the portable mp3 player market with the iPod, then customers will only have three choices:

1. Subscribe through iTunes because they want the iPod

2. Hack the iPod which Real Network is doing already

3. Or, ignore the most reliable portable mp3 player out there and deal with having a few files on their computers or on another less prominent player.

This is all great news for digital music fans, but we’ll have to wait and see how the recording industry responds to this cheap-for-all music model.

Is it sufficient to bring back the revenue streams that songwriters and singers have been losing to totally free services such as Kazaa and Grokster? No one knows.