Music Player Wars: Microsoft to Slash Zune Prices?


Microsoft is reportedly looking at alternative distribution models for the Zune, including music subscriptions which would include the Zune at little or no costs, FIN24 reports.

The business model would be similar to many cell phone contracts, which give the user the phone for free or for $1.00, in exchange for a long-term contract from the consumer.

A Microsoft spokesperson is quoted as saying, "Microsoft is exploring lots of ideas, and this is just one of them".

Microsoft refused to release number on how many users had signed up for Zune Pass, but did say that subscriptions rose by 65% in January.

Redmond has also apparently passed on a Zune phone model - for now. Earlier in the year, Microsoft appeared to be thinking seriously about an iPhone competitor, but that idea seems to be on the backburner now.

This week, in an attempt to trade on some of Apple's glory, Microsoft said that it was in talks with music companies, including EMI, to make its tracks playable on more devices. It's notable, however, that Microsoft this past week reiterated the importance of DRM, rather than removing it, as Apple-EMI have, from their higher-bitrate, premium-priced audio tracks.