I generally don't like to play armchair CEO, and I'm not privy to the inner workings of Microsoft so I won't say what is and what isn't possible, but there are a bunch of real world things I've noticed that could definitely help moving Xbox music and video forward.
Well, first off, one thing that could help is that they advertise the service. Seriously, until I joined this forum, I knew this stuff existed, but I didn't know about what it did or even the Xbox music pass. Once I got here, I thought "that sounds cool" and now I subscribe. I suspect a lot of people are in this boat. They realize its there, but they don't know the benefits. It gives you. Even if its not that important, advertise it. Did you know that Xbox music has 30 million songs while iTunes only has 28? I didn't until I looked it up, but I guarantee that if they ran a commercial with something like "try the new Xbox music, now with a larger library than iTunes", that would get peoples attention. I know this because I did the same with my friend. I was looking it up and I said "dude, look at this, did you know that Xbox music had more than iTunes?" and his reaction was "no, I didn't think anything had more than iTunes."
Another thing that I've noticed is that 2 of my friends who bought an android recently got free google play streaming (exact same functionality as Xbox music) and after a month of it for free, they're now yearly subscribing because they love it. They could do more such as giving away a full month on the Xbox instead of just 15 songs total.
Really, it all comes down to awareness. I see people bypassing the start screen and going into iTunes while imo a much better experience is right there as a clean metro app. MAYBE if they clean up the app, offer it free for 3 months with any windows 8 PC or surface, and make people aware, they could do a lot of help for Xbox music.