5 Billion songs sounds like a lot, but...

Apple announced this week they have now sold over 5 Billion songs. That is a huge number, and a huge feat in a space that was practically non-existent before the iTunes store launched.

With that said, some people, especially stock holders, might want to get out the calculators for a minute, and consider the ramifications of a rental or subscription service instead.

For this discussion, let's assume Apple's cut of rented music vs. purchase would be roughly the same. And we'll assume all those 5 billion tracks were purchased individually, meaning the sales brought in roughly $ 5 billion.

Today there are roughly 175 million iPods and iPhones sold. Let's say 150 million are still in use. Now let's assume 40% of those iPod/iPhone owners would be interested in a $15/mo rental program. $15/mo x 90 million would give Apple revenue of $1.25 billion per month.

There are a lot of unknowns here, so let's take a look at far more conservative numbers. Perhaps as few as 5%, or 7.5 million ipods/users would subscribe to the service. That would still mean more than $112 million in revenue each month, or $1.34billion per year. It would take less than four years to match the per song revenue.

This isn't meant to suggest Apple should abandon per track pricing, but rather they should offer a rental system as well. Traditionally Apple has been set in creating hardware or software, then telling the consumer why they needed it. Why not, just this once, give the consumer a choice. A choice that could ultimately lead to far higher revenue.