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With the launch of Real Networks’ Rhapsody 3.0, the company found out first hand how rough the digital music waters become when trying to educate consumers about portable subscription models. The launch – the first major revision of the company’s digital music player and service since April 2003 – came about this week with a gala event in New York City. 

Real joins a market pioneered by Napster’s Napster To Go service. Like other subscription services, subscribers to Real’s Rhapsody to Go service can only play songs on the approved devices and as long as they maintain their subscriptions. Once a subscription lapses, the songs disappear from the portable players. Napster unveiled its new service with splashy ads at this year’s Superbowl.

Real’s portable subscription plan launch “is indicative of a trend we’ll see adopted by other companies,” says Phil Leigh, an analyst with Inside Digital Media. “I think we’ll see Microsoft and Yahoo, and maybe even Apple subscription portability services sometime this year.”

In addition to a new user interface, the ability to manage music stored on your hard drive, and an offer that gives new subscribers 25 free streams per month, Rhapsody also boasts an important feature:  subscription portability. This allows Rhapsody users (those willing to pay $15 per month, as opposed to the basic $10 per month fee) to move as many of the more than 1,000,000 subscription songs to their digital music players as will fit. 

But not every digital music device will play Rhapsody To Go music. In fact, very few will. In the best of circumstances, explaining this key fact to subscribers is a difficult task. When subscribers are angry and feel misled, the difficulty is compounded.

Already, Real is facing a backlash on its message boards from angry consumers who believed the “To Go” plan meant they could port songs to their iPods – something that is not allowed. Consumers were confused, it seems, by the fact that non-subscription downloads purchased from Rhapsody can be played on iPods, whereas subscription-based streaming songs cannot be moved to iPods.

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