In a move that will likely trounce its “Complete My Album” feature, iTunes will launch an all-you-can-eat subscription service in June, according to sources at Apple Inc. The service, which will cost around $100 a month, will offer unlimited downloads of videos and music tracks from iTunes’ extensive catalog. Purchased songs, TV shows and videos still will contain the usual DRM restrictions; i.e., they may not be played on more than five authorized computers, and playlists may not be burned more than 10 times in a row. Additionally, the files will be encoded to only play on Apple devices such as iPods and Apple TVs.
The decision to offer an all-you-can-eat service is seen as a way to increase sales of the Apple TV and the soon-to-be-released iPhone, according to analysts. Sources say that Apple CEO Steve Jobs spent the past week meeting with major executives from the top motion picture studios, TV networks and music labels to hammer out a last-minute deal about how Apple would financially compensate various artists, labels and distributors.
Under the deal, Apple will track what content is downloaded and compensate artists based on an undisclosed formula that takes into account popularity, cost of the individual file, amount of times the file is played. The major labels also will receive a portion of Apple’s revenues at the end of the fiscal year, sources say.