Zune Pass: A Sheep In Wolves' Clothing
"Here's the hypothesis: once a household has a single Zune with a Zune Pass... it becomes a great motivator for other household members to choose Zune players over any other player. The reasoning, of course, is that by "going Zune", those follow-on household members not only get a great little media player, they get unlimited music to load on that player."
Harvey from Zunerama raises an interesting point. Families that purchase a Zune and a Zune Pass are more likely to be repeat/multiple buyers, simply because of the convenience, the familiar experience, and, oh, the vendor lock-in. Now where have we heard that argument before?
It's really a shame to have to think of it that way, but it's true. Microsoft's announcement that the new Marketplace will up the number of authorized Zunes per Pass from 2 to 3 is undoubtedly a good thing. Families can save money by a) using the subscription and avoiding a la carte services and b) reducing the number of subscription-enabled accounts, but do you really want your dad's bluegrass collection (or your son's latest "Soulja Boy" track) to show up on your perfectly primmed Social page? This'll be especially true when Microsoft follows Napster/Rhapsody in allowing you to access your library from anywhere via the web.
Even when sharing an account, converting your family and friends to the Social is completely in Microsoft's interest. The money they lose through familial account sharing is more than made up through extra device sales and repeat business. One of the key draws of Zune is of course its wireless sharing ability. This feature is completely useless without another Zune owner with whom I can share*, and thus it's in my interest to get my friends to buy Zunes so I can swap songs with them. Also, I'm all but guaranteed to make my next purchase a Zune if the aforesaid conditions are met and I have a significant stake in my Marketplace-acquired content. Sure, tracks downloaded from the Marketplace will work on PlaysForSure devices (at least for now...who knows what DRM the new ecosystem will use), but P4S is a dying breed, and I highly doubt we'll be seeing a surge of new P4S players anytime soon.
I listen to a lot of music. For me and others afflicted with Chronic Music Discovery Syndrome, purchasing tracks individually is prohibitively expensive, and a subscription is truly the way to go. We CMDS sufferers realize that our way not the best for everyone. We tend to be more tech-inclined than the mass market, and are thus more accepting of the limitations of a subscription—namely the lack of a tangible/sustainable product. My pitch to friends about subscription services reads exactly as you've seen a thousand times.
Me: So you can download an unlimited number of songs from a library of millions for the cost of one CD per month. If you think about it, iTunes charges $1 per track, and I download way more than 10/15 tracks in that month, so I'm saving a ton of money.**
Them: That's awesome!
Me: Yeah, the only catch is that "when you stop paying, the music stops playing."
Them: Oh. I'll just stick with Limewire/Torrents/The-400-Songs-I've-Had-For-The-Last-Decade
Article Notes: *It's called the "network effect", and also applies to telephones, fax machines, P2P, and e-mail. The second part, getting my friends to join, requires them to find usefulness in my sharing music with them. I think that given a comparable "ecosystem" experience, Zune's sharing will push it ahead of the iPod, provided it's valuable to the consumer. This chicken-and-egg problem requires a strong base, mostly through word-of-mouth and other marketing. The iPod had/has a benefited from similar bandwagoning, but with commonality through accessories and filetypes.
**This is typical marketing rhetoric. I don't "save" anything, because I would never purchase thousands of songs at $1 apiece. It's the Wal-Mart effect in full-force: creating a "need" where one previously did not exist. This is the same way that Microsoft "loses" money when you share a Zune Pass (I even used this in paragraph 3, and didn't catch it until now) or the RIAA "loses" money from P2P.