Ironically, out of these two, it's iTunes that's more harebrained. Considering that digital storage is almost free, and it's wasteful to transfer bits across half the planet each time you want to listen to a particular song again, streaming is a... pretty suboptimal solution. Especially that you essentially relinquish ownership of your own media, being instead at the mercy of a service provider. Alas, this was the way to work around the huge mess that is IP laws.
Joseph Stiglitz, "Knowledge as a Global Public Good," in Global Public Goods: International Cooperation in the 21st Century, Inge Kaul, Isabelle Grunberg, Marc A. Stern (eds.), United Nations Development Programme, New York: Oxford University Press, 1999, pp. 308-325.
It's in the sense that the current implementation of idea ownership is mostly a ham-fisted exercise in rent-seeking. Ideas work best when left to spread, mix, and be freely used.
It's a complex topic, really - on the one hand, you have the boneheaded stupidity of software patents, or of music and movie licensing (that have little to do with compensating original authors and performers, and is instead about middlemen getting rent); but on the other hand, you have drug research and $manybillion silicon fabs, which kind of require IP protection even exist.
What about the storage space? How efficient is it to have the same music duplicated on countless hard drives, in most cases not having been listened to anytime recently?
An album is probably for the purposes of discussion somewhere between 70 and 700 MB. Is keeping millions of copies of it in storage really cheaper than streaming? The "management" has to be in place either way, or how do I get them on disk in the first place? The costs of each individual steam are not, I suspect, very large
