With so much attention paid to the new generation of music subscription offerings, Spotify, Rdio and Mog, it appears that the last generation, Napster and Rhapsody, decided the best course of action was to join forces in bitterness at the fact no one mentions either of them any more. The two companies have gone through a variety of different owners over the past decade or so, with Rhapsody being spun out from RealNetworks last year, and Napster being under the Best Buy umbrella for a while -- where almost nothing was done to build up the service. I recognize that the two companies may be annoyed that no one cares about them any more, but I really can't see either establishing enough of a presence to get back into the conversation.

We were among many, many folks who were completely underwhelmed by Hulu's subscription plan for Hulu Plus. It was $10 for... not much. In fact, new reports are showing that 88% of Hulu Plus content is available via regular Hulu. On the whole, if they are going to lock up content, I'm actually glad to see them keep most content for free, but it's still not clear what additional value they're offering to get people to pay up, and customers are noticing. It seems that Hulu actually recognizes this, however. Consumerist has an email that someone from Hulu sent to an unhappy Hulu Plus customer about the weak selection and the need for ads even though she had paid, and the letter basically admits that Hulu knows Hulu Plus sucks, but they're limited by annoying contracts and they're trying to change it. Yes, it's a bit of a paraphrase, but that's certainly what's implied here:

In the ideal world, we would absolutely love and want nothing more but to be able to get every popular show out there that users love, and acquire the legal rights to stream them across every fancy device imaginable at the price that everybody wants. Unfortunately, due to stringent contract agreements on how content can be shared through certain devices, we are not able to have all of the content that everyone wants at this time.

Of course, this all comes back to the same thing we've said before. Hulu's in such a difficult place because the company needs to keep other companies so happy that it can't disrupt the businesses it needs to disrupt. You simply don't disrupt legacy businesses by working within their guidelines.

Last month, we wrote about Esquire's incredibly moving profile of Roger Ebert as part of our discussion of a segment of that article concerning Disney taking down the video of the tribute show for Gene Siskel that Ebert did right after his longtime sparring partner passed away. If you liked the Esquire piece, you should also check out Will Leitch's touching personal story about Roger Ebert, which shows how incredibly nice Ebert had been to Leitch very early on in Leitch's career (and how Leitch screwed it up in a regretfully rebellious moment).

What comes through in both pieces is how utterly nice and decent Ebert seems to be. After the Leitch piece ran, Ebert tweeted to Leitch that "all is forgiven." For decades, tons of people have connected with Ebert through his old television show, and through his movie reviews, blogs and columns. More recently, he's been connecting in a big way via Twitter as well.

And now he's trying something different. He's giving his fans a reason to buy. While we often talk about the whole CwF+RtB business model in the context of replacing traditional models -- such as for music, books and movies, it can clearly work in other areas as well. Our own curiosity led us to try setting up our own CwF+RtB offering -- which was a fantastic success (and, yes, we know we need to replenish and offer more -- hold on, it's coming).

So we're always glad to see others jumping on the bandwagon and trying similar ideas as well. In Ebert's case, it's The Ebert Club, which is a yearly subscription that grants you additional access and benefits for a mere $5. A lot of what you get is available for free, but there are some good scarcities in there -- including private discussion threads and early access to special Ebertfest events including a special meet-and-greet with Ebert himself.

It sounds like they're looking to do more as well, so it will be interesting to see what comes of it. There aren't any tiers -- it's one price fits all -- though I could see room for a tiered offering down the road as well with additional benefits (private film screenings with just club members?). But what it's really showing is that this whole concept of connecting with fans and giving them a real (scarce) reason to buy goes beyond what you might expect -- and opens up all sorts of new possibilities elsewhere as well. And, considering that Leitch's "falling out" with Ebert was over Ebert being the king of "old media," this sort of venture seems very, very new media.

While we often talk about music and movies as creative endeavors that require new business models, it's true that we don't pay as much attention to photographers -- though, I should say that when photographers do show up in the comments, they're often the most vociferous defenders of traditional copyright (much more than even recording industry guys). That's why it's interesting to see some are testing out new business models as well. John alerts us to the news that a photographer who goes by the name Ctein is running an experiment where he's asking "true fans" to subscribe to his work -- paying $9.50/month for a year. At the end of the year, he'll send them a couple of prints (chosen from a selection offered). It's based on the idea of Kevin Kelly's 1000 True Fans concept, but also seems quite similar to the business model we suggested for musicians back in 2003. I have no clue if this sort of thing will work -- especially as I'm unfamiliar with Ctein's work as a photographer or the photography market. However, it's great to see others experimenting with similar models in other areas. I look forward to seeing how well it goes.

One of the early business models we had suggested for the recording industry way back in 2003 was the idea of letting fans "subscribe" to a band -- giving them all sorts of benefits, while still making the music itself free. The idea was that you would effectively join an exclusive club, that would get you access in one way or another. It's been surprising that we haven't seen this sort of business model take off all that much, with most of the success stories so far focusing on tiered album release plans. However, it looks like Apple is moving just a little bit towards such a "subscription" offering, with its experimental "iTunes Pass" solution for the latest Depeche Mode release.

It is, as always, great to see new experiments in terms of music business models -- but, again, this one seems to get the business model backwards. Effectively, Apple and the band (or, rather, its label) are asking Depeche Mode fans to pay $9 extra for some vague promises of future benefits that aren't at all defined. And, all of it seems to be focused around the digital content (the stuff that people are a lot less interested in paying for, and which can be used -- for free -- to promote more scarce parts of a business model). Also, the "pass" isn't much of a subscription, since it only lasts for a few months. I'm sure some diehard fans will pony up, but it's not exactly a compelling reason to buy at all.

To design a good subscription plan, you could simply let anyone get the pure music for free, but offer tiered yearly plans that provide extra benefits: earlier access to the content (get the latest single before your friends!), access to a private chat room that the band actually hangs out in, opportunities to buy tickets to shows before anyone else, a chance to win backstage passes to meet the band, and (my personal favorite) an opportunity to win a private show or a "backyard" concert. Then, the more the music is out there and enjoyed, the more worthwhile it is for fans to sign up to this program. Will there be free riders? Absolutely. Will there be more free riders than members? Probably. Does it matter? Not at all. Because you'll have a situation where everyone is happy. The band is making more money than before, the band has more fans than before with more people listening to their music, and the band's true fans are more closely connected to the band. And, oh yeah, no one's suing anyone or demanding payment. It's really not that difficult.

While Microsoft remains dominant in the office productivity suite space, it knows that it's facing renewed competition from online offerings and open source offerings. While none of those other products really match the breadth and depth of Microsoft's, in some cases they're reaching "good enough" quality, and Microsoft recognizes the threat of a Clayton Christensen's "Innovator's Dilemma" situation, where the good enough product ends up beating out the much more expensive, but more complete product. So, as part of a strategy to deal with that, Microsoft is testing offering Office as a subscription service. It's targeted at consumers, not businesses, who would pay a smaller monthly fee to get Microsoft Office and a variety of other components. If they stop paying, they lose the software (but keep their data and documents, of course).

While I have no idea if this particular offering will catch on, it is a step in the right direction. Selling software as software is increasingly an unsustainable business model for all the usual reasons (infinite goods, and the like). Different companies have taken different approaches to dealing with this. IBM has shifted its business significantly over to services, and even has become a big proponent of free and open source software. Similarly, Red Hat focuses mainly on services. Google (and many other "web" software providers) focus mainly on ad-supported models for software. Microsoft, due to its tremendous legacy user base lock-in and inertia has been able keep selling software directly, and will continue to be able to so for a while. But, eventually, that business model is unsustainable -- and this new "Albany" subscription offering is a step towards moving away from it.

While it may seem like a subscription service is really just the same thing as straight software sales, it isn't necessarily. It really depends on how Microsoft treats this. If it treats it as just a way to break up the sales price of software, then it will fail. But if it rethinks it's overall approach, and realizes that the subscription fee should be for an ongoing service that provides additional benefits, then it could work quite well. From an economics standpoint, the subscription should be paying for additional ongoing services and benefits, rather than the cost of the software, which has no marginal cost to reproduce. Those ongoing benefits can be scarce goods, whereas the software itself is an infinite good. Effectively, you should be paying for future and ongoing benefits rather than the completed software. That is, there needs to be additional ongoing value to paying for the service. That means not just access to the software, but additional convenience, perhaps online storage, remote access, collaboration features, continual upgrades, service and support and the like. Make it more into a real service, rather than just a piece of software with monthly payments.

That's not to say that Microsoft will get this right. It's business model is so tied up in direct software sales, it likely will be very difficult for the company to really embrace a full software-as-a-service model. However, as things go, even experimenting with such a model is definitely a move in the right direction, and a recognition that Microsoft (even with its continued dominance in direct software sales) needs to adapt to the changing market.

While the press is reporting that TDC, Denmark's largest ISP, is now offering free music downloads at no additional charge, the fine print leaves much to be desired. It turned out (not surprisingly) that these "free downloads" are DRM-infested and will stop working if you leave TDC. That would suggest that they can't be transferred to certain devices (such as iPods) and users will have no ability to promote songs by sharing them with friends. Also, there's a rather limited song selection. While three of the major labels have signed up, there are only one million songs -- or less than 17% of the songs found on iTunes. It makes for a nice headline, but it's difficult to see this getting very far.