It is and at the same time it is not. I'm going to assume that Zappa knew a lot about the music business and just focus on the technical side.
In 1983 we were well into the BBS revolution and had 1200 baud modems (V.22 standard) making downloading of music files viable. There were BBS that had audio downloads around that time. Also, around that time the transmission of data via television became popular using teletext systems (which had started in the mid-1970s) and also direct data during programs downloaded to home computers (http://news.ycombinator.com/item?id=3857212). Also, the CD had just been released (1982 I think) and so all the ingredients were there: digital music format, distribution via phone or TV.
I think Zappa was very well aware of the technical side as well, being a Synclavier[1] 'geek' since 1982.
I do think it was quite revolutionary, since he is effectively proposing unlimited streaming of music at a fixed monthly cost:
The consumer has the option of subscribing to one or more Interest Categories, charged at a monthly rate, without regard for the quantity of music he or she decides to tape.
Sure, technically, it might be obvious. But, within the traditions and economics of the music business, such a proposal was quite revolutionary in 1983.
Or in Zappa's words:
We require a LARGE quantity of money and the services of a team of mega-hackers to write the software for this system. Most of the hardware devices are, even as you read this, available as off-the-shelf items, just waiting to be plugged into each other so they can put an end to "THE RECORD BUSINESS" as we now know it.
(I had to grin reading the word 'mega-hackers' ;))
Sure, but Zappa's not proposing to use a computer to playback the music. He's proposing a digital download of the music being transferred either onto analogue audio tape or digital tape.
In 1983 we were well into the BBS revolution and had 1200 baud modems (V.22 standard) making downloading of music files viable. There were BBS that had audio downloads around that time. Also, around that time the transmission of data via television became popular using teletext systems (which had started in the mid-1970s) and also direct data during programs downloaded to home computers (http://news.ycombinator.com/item?id=3857212). Also, the CD had just been released (1982 I think) and so all the ingredients were there: digital music format, distribution via phone or TV.