I’ve been thinking about a post that I made a few days ago that linked to an article discussing the economics of Napster-To-Go versus iTunes. The conclusions from this article focused on the losses of the music industry as a result of P2P sharing.

This morning I read this USAToday article which describes how many big players are giving away MP3 players, Blackberries, and PDAs in exchange for some purchase (e.g. buy a round-trip ticket on United and get a BlackBerry). Of course, the string here is that you have to subscribe to some service contract for some period of time, where they make up the money.

That brings me to what the next evolution in online music. Much like we get cell-phones for a very low price in exchange for a 2 year service agreement, the next step is that we will be able to get music players with the same sort of deal. It makes perfect sense to me as the music industry begins to embrace digital music subscriptions. And why not? Imagine getting an iPod for free in exchange for a 2 year, $30/month subscription to iTunes. That would be $720 paid over time, but you get all the music you can drink in that period. The music dies when the subscription dies, but since the service provider can keep it forever for me, why do I care? I can get the music whenever I want. With extension for multiple players (e.g. family plans) I end up with an unlimited, on-demand music library, which is probably my ideal.

So what’s wrong with the existing Napster model? To much money up front. I have to buy a music player for $300 to get to use it. If the music player is part of the subscription, then just like a cell phone, I’ll throw it away when my 2 year service agreement is up. After all, that’s sort of what’s happening with MP3 players anyway. I’ve had 2 disk-based units now (an Archos and an iPod) over the span of about 4 or so years. They break, they become old tech, I want a new one. What a perfect scheme. If Apple’s on the ball, that’s what will happen next, but I’m betting that Napster or some other service provider will jump on this first.