It's so cute when the major labels do this digital thing--they're sort of like your doddering old uncle who once got a patent for a new kind of horse-and-buggy harness and now sits in the basement tinkering with bridles all day.
Today's example: the Universal Music Group, the largest of the big four record labels, is teaming up with BSkyB, a U.K. satellite TV network owned by News Corp., to offer a subscription-based music service by the end of this year. I don't have anything against subscription services: although none of them have been as successful as Apple's iTunes, which is a pure download service, Rhapsody has some devoted fans. Plus, it sounds like the service will be more akin to eMusic's subscription-plus-download plan, offering a set number of MP3 downloads for each subscription level. (Pricing and other details have not yet been announced.)
But the debate over subscriptions misses the point. The deal involves only one of the big four record labels. Music listeners don't know and don't care about record labels. They know their favorite songs and artists. If the songs aren't available on one service, they'll turn to another service--like iTunes or Amazon.com MP3--where they are available.
BSkyB says it's going to try and sign other labels up for the service. But this is what Nokia said last year when it announced its Comes With Music plan--essentially a pre-paid subscription for unlimited downloads to certain Nokia phones (the subscription's added to the price of the phone). And how's that working out? The service is delayed, EMI's still holding out (although it might come on board before launch), and there's nothing about the indie labels and unsigned bands that have helped make MySpace and eMusic and CDBaby.
Meanwhile, over at iTunes, more than 5 billion downloads have been sold.
If the major labels want to create a viable alternative to iTunes, they'll have to team up first, ideally bringing indies in on the game, then find a distribution channel. Not the other way around.