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The 98% of iTunes users who like downloading, do it infrequently, and will never subscribe to a streaming service. Or, another way to put it, the silent majority who aren't in this particular thread to speak for themselves.

Again with the made up 98% figure.

If 98% like downloading and have a library of 25,000 songs, like you, they're more like the 1%. You're a massive contradiction to your own posts.
 
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Nielsen Music's end of year data for music consumption in 2014 showed a 54% increase in streaming services with a 60.5% increase for audio services.

While digital sales fell 12.5% and physical sales fell 14.9% in 2014.

What you say to that boltjames....
 
Two different behaviors, completely different motivation:

Listening to random music in a genre you love is called "radio". And it's free.

Listening to a specific album by a band you love is called "purchasing". And it costs $12.

What you, and Apple Music, are trying to argue is for people to pay for radio. You can spin it any way you want, you can justify it financially, you can go round and round about features like For You and New and Offline but in the end an endless and random assortment of new and old songs in a specific genre is RADIO. And no one spends money for RADIO. We have had it for 90 years. And it's free.

Two mistakes there.

Firstly, I certainly haven't argued that people should pay for anything.

I have just disagreed with your insistence that AM is objectively flawed just because it might not suit everybody.

Secondly, I disagree it's the same as radio. Listening to the radio lets you hear a selection of songs which you may or may not like.

It certainly doesn't let you download those songs, let alone whole albums of songs to your device so that you can listen to them.

If anything AM might be like the sum of radio + ITMS.

If you are only really interested in listening to the curated playlists in the same way you would listen to the radio, that's fine.

But as far as I can tell AM offers much more than that, whether you make use of it or not.

An average is an average. The people who say no and spend nothing are just as relevant as those who say yes and spend a lot. It's an average. It represents the entire iTunes public. It's extremely unskewed and it's the only way to look at it.

Except in statistics, it's not. You could have a typical bell graph with normal distribution - which would be a minimum of 0, an average of 12, and a maximum of 24.

Which in this case is extremely unlikely. What is far more likely is
an abnormal distribution with a positive skew:

http://www.ken-szulczyk.com/misc/statistics/asymmetric_distribution_01.png

I still don't see the point of including tens of millions of people that spend $0.00.

In this universe, where 800 Million iTunes users only purchase 1 album a year, that's where.

Do this: Take everything you know and divide it by 12. Because you are 12x the typical iTunes user and your opinions are 12x more extreme.

BJ

But those numbers don't add up!

How can that possibly be the case if it would take me 140 years to amass a 25,000 song library?

I still don't know why you keep making this about all iTunes users, when its only really about people who are interested in music.

What do people like my 78 year old Mum, with no interest in music, and only has an iTunes account for a handful of apps on her iPad have to do with the pricing of AM?
 
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iTunes Radio is a portal of discovery that then requires two clicks to download song files into your Library.

Apple Music is a portal of discovery that then requires two clicks to download song files into your Library.

They are the same thing.

Is one of those clicks on a buy button?

Your steady, average monthly consumption appears to be 12x the average. I only have 25,000 songs because an explosion of content found its way to me 15 years ago. Take out that 1 year, take out all the stuff I needed to convert from vinyl to digital anyway, you'll find that in a hot year I'll pull down 8 albums and in a lame year I'll pull down 0, average year must be 2-3 albums and that's it.

End result is the same - over your lifetime you have amassed a library of 25,000 tracks.

Again, people who have no interest in music are irrelevant.

You put that figure at 400m. So that sees your average double to 24 straight away.

I'd be interested to see your working for how that puts me in an extreme of just 1%.

Not sure what this is supposed to mean. Streaming is radio and people don't pay for radio. Radio is free. Radio is a promotional vehicle to sell a product. Radio is an advertisement, it's not the medium. Consumers have a fair deal with record labels. They release songs, they get played on the radio, radio stations sell advertising, consumers hear new material repeatedly. What we like we purchase. What we don't like we merely listen to. People don't pay for radio.

BJ

You've got it!

Radio is a promotional tool to get you to buy the music.

Whereas a streaming subscription actually is the product.
 
The only person who would spend $120 on unlimited downloads today is the same person who went nuts when Napster and Limewire ruled the planet. Be they building collections illegally or via gluttonous iTunes usage, they have a huge back catalog so that offering from Apple leaves much to be desired.

Assumption 476.

I doubt this is actually true.

If you were determined you could download lot of stuff from Napster. But it required a bit of knowledge, it was time consuming, you ran the risk of downloading garbage or even virus, and it was illegal.

A streaming subscription has none of those issues.

So I suspect there are plenty of people who would not have used Napster but would use a streaming service.
 
The long and the short of it is that people resent paying to rent music.

The only way Apple will achieve mass take-up of Apple Music is to drastically lower the price to $3 a month or less. Then it will become a service commensurate with its value.

I hate how restricted it is—only one device at a time. I also hate how complicated it is in relation to iTunes Match. If I lose my local data due to fire, theft or hard drive failure, I don't want the risk of my music being converted to DRM.

It's the lack of control which is the real killer and is why, for me, streaming can only ever be a sidekick to owning.
 
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Firstly, I certainly haven't argued that people should pay for anything.

I have just disagreed with your insistence that AM is objectively flawed just because it might not suit everybody.

Secondly, I disagree it's the same as radio. Listening to the radio lets you hear a selection of songs which you may or may not like. It certainly doesn't let you download those songs, let alone whole albums of songs to your device so that you can listen to them.

If anything AM might be like the sum of radio + ITMS.

Yes, Apple Music is like the sum of Radio + iTunes Music Store. That's what I've been saying for days. If it wasn't clear, now it is.

I still don't see the point of including tens of millions of people that spend $0.00.

Because Apple isn't building Apple Music as a charitable endeavor. It's a paid service and one that's more expensive than the average person spends now. So not only is including tens of millions of people who pay $0 for music today through iTunes relevant, it's practically the entire point. Apple grows its music business and fends off streaming competitors like Spotify. That's the sole reason for this product.

But those numbers don't add up!

How can that possibly be the case if it would take me 140 years to amass a 25,000 song library?

I still don't know why you keep making this about all iTunes users, when its only really about people who are interested in music.

Because I believe that all people interested in music are already iTunes users. It's the world's biggest music store, it's available to anyone on the planet, and it's been around for 14 years. Yeah, you can tell me that there are 100 people in Ghana who don't use it and still use CD players, it's statistically insignificant.

What do people like my 78 year old Mum, with no interest in music, and only has an iTunes account for a handful of apps on her iPad have to do with the pricing of AM?

If they want your mom as a paid subscriber, they'd better be worried about the pricing of Apple Music. The existing model of Free Radio + iTMS works for the vast majority of iTunes users. Breaking that model into a new one has to be priced competitively and reasonably, not from the label and artists point of view but from the consumers point of view. If my mom is satisfied with free FM radio and spends $12 a year on an album or a few songs then Apple Music better have that 'blow me away' feature (it doesn't) or a very compelling price (it doesn't) or there is no reason for anyone to consider it.

BJ
 
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The value of something is not equal to the lowest amount of money people are prepared to pay.

Please, we're Apple zealots here. We pay 3x more for a Retina MacBook than a comparable HP because there is significant quality there, so much so we are inclined to pay a lot more for something that essentially does the same thing. We are not cheapskates. We're used to indulging ourselves to the finer things in life for a bit more money.

The problem for us is that Apple Music isn't offering anyone anything of value that is that significant that it's worth moving away from the current model. Unlike a MacBook, an iPad, or an iPhone, Apple isn't offering us an advanced product; they're offering us a rebranded service.

And unlike the iTunes Music Store which re-wrote the rules, Apple Music is a clear and obvious money-grab and it rubs more people the wrong way for many more reasons than just the fact that the industry is releasing crap.

BJ
 
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Yes, Apple Music is like the sum of Radio + iTunes Music Store. That's what I've been saying for days. If it wasn't clear, now it is.

Actually no - you've been saying "Streaming is radio".

Because Apple isn't building Apple Music as a charitable endeavor. It's a paid service and one that's more expensive than the average person spends now. So not only is including tens of millions of people who pay $0 for music today through iTunes relevant, it's practically the entire point. Apple grows its music business and fends off streaming competitors like Spotify. That's the sole reason for this product.

So what if its more expensive than the average person spends? Since when was the price of something based on "what the average person spends"?

Because I believe that all people interested in music are already iTunes users. It's the world's biggest music store, it's available to anyone on the planet, and it's been around for 14 years. Yeah, you can tell me that there are 100 people in Ghana who don't use it and still use CD players, it's statistically insignificant.

I'm sure a lot of people who are interested in music are iTunes users.

But that's completely different from people who are iTunes users are interested in music.

You don't seem to have addressed my point there - which was this:

If it would take me 140 years to amass a 25,000 song library, how can that possibly put me in the top 1% of all people who buy any music?

If they want your mom as a paid subscriber, they'd better be worried about the pricing of Apple Music. The existing model of Free Radio + iTMS works for the vast majority of iTunes users. Breaking that model into a new one has to be priced competitively and reasonably, not from the label and artists point of view but from the consumers point of view. If my mom is satisfied with free FM radio and spends $12 a year on an album or a few songs then Apple Music better have that 'blow me away' feature (it doesn't) or a very compelling price (it doesn't) or there is no reason for anyone to consider it.

BJ

I really doubt they'd have any expectation for people like my Mum to subscribe. Why on earth would she? She's 78, and has precisely zero interest in music. All of this is a complete red herring on your part.

It doesn't really need to attract people like her.

It needs to attract people who have at least some interest in music.

If someone buys 12 albums or more a year, its practically a no brainer.

Even if someone buys 1-12 albums a year, the prospect of being able to listen to a lot more than 12 albums will be a good enough value proposition for a lot of people.

In short, it doesn't need to be priced at the lowest amount of money people would pay.

Just like the unlimited card for a cinema isn't about to be priced at $10 a year because that's the average amount people spend going to the cinema in a year.
 
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Is one of those clicks on a buy button?

Yes.

I took the time to familiarize myself with Apple Music. I suggest you do the same with iTunes Radio. I really don't want to spend another day teaching you how to buy a song off of iTunes.

Again, people who have no interest in music are irrelevant.

I'd be interested to see your working for how that puts me in an extreme of just 1%.

No one said the iTunes users who spend $0 a year are "not interested in music". They might be a bigger hardcore extremists than yourself. They simply aren't spending their money in iTunes. You'd be surprised at the size of the torrent community, the residue of Napster for today's youth. My guess is that these iTunes users take advantage of free services like Pandora (home) or FM radio (away), they don't commute by car, they don't travel much by air, and they don't have a lot of money to throw at cellular data plans.

You've got it!

Radio is a promotional tool to get you to buy the music.

Whereas a streaming subscription actually is the product.

No!

A streaming subscription just makes a radio into a DVR. You can listen on demand and time shift. An assortment of fresh songs and old songs played randomly is "radio", doesn't matter how its delivered. And that's the biggest issue that streaming services face; it's not different enough from that which is available for free. Good songs always bubble up, only a handful of people care enough to dig for the deep album cuts.

Have the labels shut down FM and Pandora radio, then you're onto something. Take away the free part, we're all going to have to pay for it. Until then, I can listen to Taylor Swift or a reasonable facsimile 24/7 via free means, I can pay $5 for her best 5 songs, I don't need to pay to listen to the rest on demand.

BJ
 
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Please, we're Apple zealots here. We pay 3x more for a Retina MacBook than a comparable HP because there is significant quality there, so much so we are inclined to pay a lot more for something that essentially does the same thing. We are not cheapskates. We're used to indulging ourselves to the finer things in life for a bit more money.

The problem for us is that Apple Music isn't offering anyone anything of value that is that significant that it's worth moving away from the current model. Unlike a MacBook, an iPad, or an iPhone, Apple isn't offering us an advanced product; they're offering us a rebranded service.

And unlike the iTunes Music Store which re-wrote the rules, Apple Music is a clear and obvious money-grab and it rubs more people the wrong way for many more reasons than just the fact that the industry is releasing crap.

BJ

None of that changes the fact that the value of something is not equal to the lowest amount of money people are prepared to pay.
 
The long and the short of it is that people resent paying to rent music.

The only way Apple will achieve mass take-up of Apple Music is to drastically lower the price to $3 a month or less. Then it will become a service commensurate with its value.

I hate how restricted it is—only one device at a time. I also hate how complicated it is in relation to iTunes Match. If I lose my local data due to fire, theft or hard drive failure, I don't want the risk of my music being converted to DRM.

It's the lack of control which is the real killer and is why, for me, streaming can only ever be a sidekick to owning.

Bingo, Ben. As usual.

We have a model of music experience that has been around for 90 years that works (radio) and we have a model of music purchase that has been around for 15 years that works (iTMS) and with those blocking the way there is no way a streaming service can amount to a hill of beans.

You can't read an entire newly released book without paying for it. You can't watch an entire newly released movie without paying for it. But music through radio allows you to listen to an entire brand new song without paying for it. With a competitor like that, there is no way streaming can win. Not for $120 a year. Not for $50 a year. Probably not for $12 a year. Who needs this thing? Small fraction of the public, that's it. We should talk about an Apple product that tons more people use and offers a lot more value. Something like the backlight feature on the iPhone. Something important.

BJ
 
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None of that changes the fact that the value of something is not equal to the lowest amount of money people are prepared to pay.

It does when the competitive product has been successful for 90 years and costs nothing.

Go open an oxygen store and try to run a successful business selling breathable air to people who get it every day for free. We're not on the Moon, John. This is Earth.

BJ
 

Right - so iTunes Radio isn't like AM at all then, because you have to buy the tracks you want to add to your library. They don't get added to your library just by virtue of then being on the radio.

I took the time to familiarize myself with Apple Music. I suggest you do the same with iTunes Radio. I really don't want to spend another day teaching you how to buy a song off of iTunes.

That's OK - I know how to do that.

Up until now you have been trying to argue that radio = streaming and radio = free. Clearly its not free at all if you include buying stuff you want to add to your library.

No one said the iTunes users who spend $0 a year are "not interested in music". They might be a bigger hardcore extremists than yourself. They simply aren't spending their money in iTunes. You'd be surprised at the size of the torrent community, the residue of Napster for today's youth. My guess is that these iTunes users take advantage of free services like Pandora (home) or FM radio (away), they don't commute by car, they don't travel much by air, and they don't have a lot of money to throw at cellular data plans.

Oh make up your mind! You've only just finished saying that everyone interested in music has an iTunes account. So now there's a demographic of people who are interested in music, do have an iTunes account, but don't buy music from the ITMS.

Either way, it doesn't change the fact that there are likely tens of millions of people with iTunes accounts who don't buy any music because they have zero interest in music. Like my Mum.

No!

A streaming subscription just makes a radio into a DVR. You can listen on demand and time shift. An assortment of fresh songs and old songs played randomly is "radio", doesn't matter how its delivered. And that's the biggest issue that streaming services face; it's not different enough from that which is available for free. Good songs always bubble up, only a handful of people care enough to dig for the deep album cuts.

Have the labels shut down FM and Pandora radio, then you're onto something. Take away the free part, we're all going to have to pay for it. Until then, I can listen to Taylor Swift or a reasonable facsimile 24/7 via free means, I can pay $5 for her best 5 songs, I don't need to pay to listen to the rest on demand.

BJ

Yes! As a consumer of music all I really care about is this: can I listen to the music I want to listen to, when I want to.

I think "or a reasonable facsimile" is a pretty big caveat.

I can listen to any of her albums as and when I want.

You can stick on a playlist and get what your given.

That is a massive difference.
 
It does when the competitive product has been successful for 90 years and costs nothing.

Go open an oxygen store and try to run a successful business selling breathable air to people who get it every day for free. We're not on the Moon, John. This is Earth.

BJ

The competitive product doesn't cost nothing.

Assuming the competitive product is radio + ITMS.

Unless music on ITMS is now free?

Or are you back to streaming = radio?

Which would be a shame as we finally figured out that actually streaming = radio + ITMS.

Basically, being able to listen to a stream of songs that you have no real control over is not a competitive to or comparable with the ability to listen to the specific music you want to, when you want to.

You can't do that with radio, which is where your streaming = radio argument falls down.

And if you buy stuff from ITMS, that's where your streaming = radio = free argument falls down.
 
The long and the short of it is that people resent paying to rent music.

The only way Apple will achieve mass take-up of Apple Music is to drastically lower the price to $3 a month or less. Then it will become a service commensurate with its value.

I hate how restricted it is—only one device at a time. I also hate how complicated it is in relation to iTunes Match. If I lose my local data due to fire, theft or hard drive failure, I don't want the risk of my music being converted to DRM.

It's the lack of control which is the real killer and is why, for me, streaming can only ever be a sidekick to owning.

And yet streaming revenue is increasing significantly year over year while physical sales are declining. So that's not the long and the short of it.

Do some people feel it's a bad value? Yes, clearly. But far more people think it's a great value, so it makes no sense to drop your price by 66-80% to try and catch the few outliers who resent the very idea of the service in the first place.

Also, you both have to realize that the pricing was not Apple's decision. They tried to get it to $7.99 per month to undercut all the other services and the record labels wouldn't play ball at that price. And since iTunes sales are also declining, Apple had to respond to pressures in the marketplace. They're not doing this for a chuckle.

You sound like a radio serial actor from the '50s saying, "TV? It'll never catch on! People don't want to watch stories, they want to hear them and use their imagination!" Well we all know how that turned out.
 
Actually no - you've been saying "Streaming is radio".

Streaming Playlists/Radio + Offline = Apple Music
Streaming Radio + Downloads = iTunes Music Store

The "streaming" part is the same for both services; the difference is in that one has 'offline' listening as rentals and the other 'downloads' as purchases. Are we really going to get into semantics here?

So what if its more expensive than the average person spends? Since when was the price of something based on "what the average person spends"?

The typical Honda sells for $23,000 in the United States. If Honda suddenly came out with a $200,000 car it's not going to sell very well as it's not who their buyer is.

You don't seem to have addressed my point there - which was this:
If it would take me 140 years to amass a 25,000 song library, how can that possibly put me in the top 1% of all people who buy any music?

Everyone who has a Library that big had 1 spectacular year where they pulled down 10,000 songs from friends, relatives, CD collections, and Napster followed by some very shallow years where it was just 1 or 2 albums worth of material off of iTunes.

So being a hardcore 1%'er means you're pulling down 1-2 albums a month here in 2015 whereas statistics say the average iTunes user pulls down just 1 album per year here in 2015.

Overall size of collection = interested in music and opportunistic when free stuff abounds.
Monthly expenditure = hardcore, has the time to engage with 25 to 50 albums a year.

In short, it doesn't need to be priced at the lowest amount of money people would pay.
Just like the unlimited card for a cinema isn't about to be priced at $10 a year because that's the average amount people spend going to the cinema in a year.[/QUOTE]

People have a funny way of settling in and ultimately telling businesses what something is worth, don't they? Two slices of pizza and a Coke cost $2.99 in New York, no one is going to pay $29.99 because it's served on a gold doily.

BJ
 
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None of that changes the fact that the value of something is not equal to the lowest amount of money people are prepared to pay.

Let's put it this way:

At $120 a year Apple Music will be utilized by no more than 3% of the iTunes userbase. If they can figure out a way to lower the price they might be able to double or triple that. Either way, it's a single-digit opportunity, not really something Apple likes to cater to. Jobs stopped development on the fractional iPad because the Phone was the bigger market. Cook is chasing pennies with this one.

BJ
 
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Right - so iTunes Radio isn't like AM at all then, because you have to buy the tracks you want to add to your library. They don't get added to your library just by virtue of then being on the radio.

With both services you have to hit two buttons to get them onto your device for future listening. I have no idea where you are going with this. One service is a flat rate $10 a month, the other service is pay-as-you go. Both services allow you to hear full versions of songs before committing them to eat up hard drive space.

Up until now you have been trying to argue that radio = streaming and radio = free. Clearly its not free at all if you include buying stuff you want to add to your library.

Okay then, now I've made it clear I guess.

Oh make up your mind! You've only just finished saying that everyone interested in music has an iTunes account. So now there's a demographic of people who are interested in music, do have an iTunes account, but don't buy music from the ITMS.

It's common sense that more people listen to music than buy it. Radio is free. New music is all around us every day. Only a percentage of us like a song so much we need to buy it and listen to it over and over again.

BJ
 
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The competitive product doesn't cost nothing.

Assuming the competitive product is radio + ITMS.

Unless music on ITMS is now free?

Or are you back to streaming = radio?

Which would be a shame as we finally figured out that actually streaming = radio + ITMS.

Basically, being able to listen to a stream of songs that you have no real control over is not a competitive to or comparable with the ability to listen to the specific music you want to, when you want to.

You can't do that with radio, which is where your streaming = radio argument falls down.

And if you buy stuff from ITMS, that's where your streaming = radio = free argument falls down.

Ugh, again semantics.

To the typical non-hardcore music listener, they can put on an Alternative FM station -or- Pandora -or- iTunes Radio and achieve the same effect as Apple Music with their not-so-fancy "Playlists", and "For You", and "New" functions. Hours and hours of music around a Genre, just tap a button, sit back, and let the internet or terrestrial signals mix your day.

We're talking about what 90% of Apple Music subscribers will do here. It's not about taking songs 'offline' and building a library. It's about letting someone else program what you're listening to. iTunes Radio and Apple Music, same thing. Paying $120 for taking songs "offline" or paying $120 to "download" them is the same thing, difference being the All-You-Can Eat Chinese buffet vs. sitting down and ordering a-la-carte off the menu. Same food, different amounts, different pricing, different delivery method. Same food. Moo Chu Pork? Same. Chicken and Broccoli? Same. Fried Pork Dumplings? Same. If you need 50 pounds of Pork Lo Mein, Apple Music is a win. But no one can eat that much. So its a loss.

BJ
 
Let's put it this way:

At $120 a year Apple Music will be utilized by no more than 3% of the iTunes userbase. If they can figure out a way to lower the price they might be able to double or triple that. Either way, it's a single-digit opportunity, not really something Apple likes to cater to. Jobs stopped development on the fractional iPad because the Phone was the bigger market. Cook is chasing pennies with this one.

BJ

Time will tell, but I suspect it might be more than 3%. Which already is double your earlier figure of 1.5%. By way of comparison, the % of Spotify's user base is much higher then 3% - more like 25% +.

Either way, I still don't see what your point is - perhaps if they sold MacBooks for $100 they would sell more of those too.

For pretty much as long as Apple has been in existence its been about single digit opportunities. Didn't Jobs talk about getting 1% of the mobile phone market with the iPhone?

Hasn't the Mac almost always been a single digit proportion of the PC market?
 
You sound like a radio serial actor from the '50s saying, "TV? It'll never catch on! People don't want to watch stories, they want to hear them and use their imagination!" Well we all know how that turned out.

There is nothing fundamentally new about Apple Music. There is no 'wow' feature that is gamechanging. It's iterative. It's just a new delivery model. This isn't like the first time someone saw Color TV, the first time someone experienced Cable TV, the first time someone flew on a jet aircraft, the first time someone picked up an iPhone. This is a yawn.

I have a great idea for this thread though. Let's shift gears and discuss what's really bothering most people when you take the finances out of it. We say "its too expensive", you say "its a great value". Let's move past that:

What happens when you want to hear Prince and take his work offline and you find out you can't?

What happens when you are fed a customized Southern Folk Singer-Songwriter Essentials playlist and it has no Neil Young on it?

What happens when Jay-Z launches his new LP on Tidal and forces Apple Music listeners to wait six months to get it?

What happens when Sony Music launches its own streaming service in 2025 and all your Billy Joel songs are pulled from Apple Music and all your personal playlists after being there for a decade?

What happens when the Beatles decide to create their own network in their own app called Beatles Music and charge just for that?

What happens when Apple Music increases their rates to $20 a month?

What happens when you have to curtail your Apple Music experience because its racking up $20+ in data overages?

What happens when all this fragmentation plaguing the streaming market finds its way into the iTunes Music Store and destroys the brilliant one-stop-shop that it is now?

The cost isn't the real issue. It's the renting. It's being held hostage. It's the lack of control.

BJ
 
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