Sooner or later, everything goes online. Music, books, newspapers, magazines, TV shows, movies, software, classified ads, restaurant menus, maps, and on and on.
It’s fun to watch these industries reinvent themselves in the digital age. At first, of course, the online marketplaces are literal interpretations of the physical ones. If you want to buy music, you pay a per-song or per-album price, and you own the music files, just as though you’d bought it on a CD.
But eventually, the business plans diverge. People start to exploit what’s different about online distribution. They come up with all kinds of pricing models pegged with different degrees of convenience and control.
Take music, for example: here’s a sampling of the different ways you can consume it, along with the pros and cons of each.
- Internet radio. Pros: Free. Thousands upon thousands of radio stations in every conceivable genre. Cons: You don’t get to specify the song or the singer. You’re generally tied to your computer, or to a smartphone with a very generous data plan.
- YouTube. Pros: Just about every pop song is available for listening on YouTube—some officially (as part of a music video), some not. Free. Cons: One song at a time. Available only on computer or smartphone. Clumsy.
- Pandora radio. Pros: Free for the basic version. You can specify a band or singer you like, or even a type of song, and Pandora will create a new “station” for you that plays only that kind of music. If you don’t like a certain song, you can hit Next to skip it. Cons: The free version shows ads, conks out after an hour of playing, and has other limitations.
- Satellite radio. Pros: Enormous number of stations; the music channels are ad-free. Works in your car, never fades as you drive across the country. Cons: $13 a month. You still can’t specify individual songs or bands you want.
- Subscription music. Pros: You can download exactly the songs and albums you want, unlimited, for a flat monthly fee. They’re on your music player or phone, so you don’t need an Internet connection. Cons: You don’t actually own anything. When you stop paying your $10 a month, you’re left with nothing but memories.
- Pay-to-own music. Pros: You choose exactly the songs and albums you want. You own them forever. They play on any player, no Internet connection needed. Cons: The most expensive per-song option here (as much as $1.30 a track).