It is reported that Microsoft is going to pay Universal Music a fee for every Zune it sells. This is on top of the normal licensing fee that Universal receives for the sale of each song in their catalog. So the question is, Why are they paying them a fee on every player sold? Maybe because they are trying to purchase an agreement for music sales from a reluctant partner.
So is Microsoft now going to pay off every music company? I would have thought that Microsoft had more clout than that. Not that they can make or break a music company, but Microsoft is surely a good company to be partnered up with. In the end they could end up paying so much in fees to various music companies that they would sell the unit at a loss, just like they do with the Xbox. Only in this case there is no secondary means of generating revenue like the Xbox plans to do with their Xbox Live Video Download Service. I can’t say I am impressed with how the Zune is looking coming out of the gate.
