Free Zune with Marketplace Subscription?

Microsoft may make the Zune less of an iPod competitor and more of an iTunes competitor. They may follow the lead that cell phone companies have been using for ages, free [or discounted] phone with the purchase of a contract (typically for 2 years). This will ultimately be the same way that the iPhone will be cheaper to buy from Cingular, but in this case you pay the fee for the music and the contract is with Microsoft.

Speculation has begun from a comment made by Zune marketing director Jason Reindorp. He stated that they were looking at a Zune Pass subscription that is like a cell phone contract. The model has worked very well for the cell phone industry, so why not for the MP3 marketplace?

It’s quite a good concept because it really would bring in more customers. Most people don’t really use the WiFi functionality of the Zune, so that really isn’t a killer app. However, the concept of being able to download all your music and get a Zune music player for a fixed price, well that sounds pretty good for the average joe.

The only thing they need to do though is keep the price point of the device at the same point. This would be disaster for Apple, because would you rather buy an MP3 player (iPod) or a 2-year subscription with a Zune for the same price? Some would call this a VERY smart move. Let’s see how it goes.