Magnatune, the online music label has recently switched to the unlimited membership business model from the pay-per download model. This change was announced in the official Magnatune blog written by the founder John Buckman’s.
Magnatune as we all know is a service to share DRM free music with the Creative Commons Attribution-NonCommercial-ShareAlike license. Wikipedia defines Magnatune as,
Magnatune aims at treating both its musicians and its customers fairly. In May, 2008 Magnatune launched all-you-can-eat membership plans, and is believed to be the only online music site to offer a DRM-free unlimited membership. Magnatune was the first record label to license music online and as of May 2008 had sold over 3000 licenses in its five years of existence.
The reason for this change as given by Buckman is that the main source of revenue for Magnatune is its paid membership. It registered a huge hike in revenues from unlimited accounts, which made 74% of the total revenue. Album download revenue on the other hand, has declined sharply.
Other changes at Magnatune include the removal of the CD sale service and disallowing registration of any new streaming members.
Magnatune is an awesome service and is beneficial for both the musician and the listener. The site provides a 50% revenue share to the musicians and gives DRM free music. Magnatune is the pioneer in this field and is sure to stay. The change will have no effect on existing members and will simply benefit those who are new to Magnatune.