Napster, Still Struggling, Puts Itself Up For Sale

from the shocking dept

Napster's never been able to regain its cachet in the music-download business after going legit, despite a few different owners, so it's hardly surprising to see the company essentially put itself up for sale. While the company's CEO says there's been a lot of interest in partnerships or joint ventures, Napster's struggles illustrate the reality of the music download business as one where it's awfully hard to make money. While Apple's sold over a billion songs through the market-leading iTunes Music Store, those songs were loss leaders, intended to drive iPod sales and to lock users in to the device. The CEO also says that its new products are getting "traction" -- but they don't look to be helping the company turn a profit, and it said it's losing paying subscribers as it promotes its free service. There's nothing here, and nothing in the company's history, to suggest it can be successful. Perhaps the best thing for the company and its shareholders is to grab whatever cash it can in a buyout, playing off the growing interest in mobile music download services by selling out to a company in the mobile space that can ditch the current Napster offerings and salvage its backend into something useful -- with Ericsson, a company already partnered with Napster for mobile music, a prime candidate.

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  1. identicon
    Anonymous Coward, 19 Sep 2006 @ 12:00pm

    Re: when has Apple called iTMS a loss leader?

    Whats wrong with the referneces from 2003?

    Apple called it a loss leader and said they hoped that eventually it would break even.

    What part of this is causing you to struggle against?

    Apple maintains the industries highest margins, and is a successful company. iTMS does not share those margins. iTMS is there to help maintain those margins in other products. Thats good enough to be a loss leader to me. Can't you just accept that?

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