Appleis in talks with major music companies to offer customers free access to its entire iTunes music library in exchange for paying a premium for its iPods and iPhones, the Financial Times said.
Citing people familiar with the talks, the paper said the negotiations hinged on a dispute over the price Apple would be willing to pay for access to the labels' libraries.
One industry executive said research showed consumers would pay a premium of up to $100 for unlimited access to music for the lifetime of a device, or a monthly fee of $7-$8 for a subscription model.
Apple was not immediately available for comment.