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The Leopard Report: Is it Time for a Subscription Program?

In interviewing author Kirk McElhearn for this week’s episode of The Tech Night Owl LIVE, we got to talking about whether Apple should look at some alternatives for distributing Mac OS X and some of its consumer-level digital life products.

Today, you can buy Tiger for $129 for the single-user package. A .Mac subscription is $99 per year, and a copy of the latest iLife — still stuck at ’06 — is $79. Now Steve Jobs has admitted that .Mac hasn’t really progressed as far as it could or should, other than to add some minor frills, a fancier Web-based email interface and a storage upgrade.

I’m not about to suggest where .Mac can go. I’m a member, partly out of inertia I suppose, though I do use the iDisk occasionally as a method to send and receive large files that my email server will choke over.

As far as iLife is concerned, I expect there will be a new one by the time Leopard ships, possibly with an ’08 designation, since it’s too late for ’07, although I suppose Microsoft won’t agree. I’ve weighed in on this before, but I really think that iLife should be bundled with Leopard. It’s so closely entwined with the operating system, that you really have to keep versions constant with both. So it makes sense to put them in the same package.

There’s also another issue, one that affects the millions of you in our audience that do not have broadband. Apple’s updates are getting larger and larger, particularly with the Intel-based Macs. Even if you set up a brand new Mac, you may find yourself having to endure the download of several hundred megabytes of data to bring things up to date. This can certainly be a royal pain, particularly if the connection is disrupted from time to time. When it comes to dial-up — well, forget about it. Sure, you could bring your Mac to an Apple Store or a third party dealer that is generous about such things, and download to your heart’s content. But what if there’s no cooperating dealer nearby?

In light of all this, Kirk and I agree that the time is ripe for a new way to market these products, a way that will ensure that everyone is kept up to date. In other words, a software subscription program. I mean, the idea of delivering software this way as opposed to outright purchase has been discussed in recent years by Microsoft and others, but here it makes a lot sense.

Just imagine a special program from Apple that includes the latest Mac OS X upgrade kit, the latest iLife, a .Mac subscription, and regular update CDs with all the latest and greatest stuff on them. Would that make sense to you?

So how much should such a package cost? Well, that’s a good question. Apple no longer does annual Mac OS X upgrades, so a package of this sort would probably be of two year’s duration, minimum, to encompass all the possibilities. That would, of course, tie them in to a fixed schedule, but one that’s not really out of the question, considering the pace of past development.

I’m thinking in terms of maybe $149 per year. Kirk suggested a somewhat higher price.

If you purchase a new Mac with the latest and greatest operating system release on it, I suppose there could be a special $99 program that will include just .Mac, the CD updates and all major revisions to iLife.

Obviously, the logistics of such a program are far more complicated than I’d care to deal with here, and I can see lots of rules and exceptions to accommodate different uses. Those who buy family or small business packages, for example, would qualify for a higher-priced deal, but one that would still be more affordable than buying everything separately.

In the end, remember that you would still own your software licenses in the same fashion as you do now. That’s altogether different from a music rental scenario. There, I more or less agree with Steve Jobs that most people want to own music rather than pay a monthly fee for temporary access. While there are apparently several hundred thousand or more subscribers to such services from Napster, RealRhapsody, Yahoo Music and other music stores of that sort, I don’t think the future of that economic model has been demonstrated.

I can see maybe as a music sampling method, though, particularly if you don’t think the 30-second samples you get on iTunes are sufficient to help decide whether to buy the song. Obviously, with digital music, you can’t get a refund!

So are we going to see a new Mac OS X distribution strategy when Steve Jobs pulls the wraps off Leopard’s remaining new features at next week’s WWDC? Probably not, but it’s still worth discussion. What do you readers think?