Napster 2.0 lost 15 million dollars in the first 2 months.
 

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According to an article on Mercury News, Roxio is in some serious problems with it's legal music download service Napster. Napster has lost 15 million dollars in the first 2 months of this year. Top executives such as the president, the chief financial officer, the vice president of programming and the head of corporate communications are leaving the boat. Also, HP surprisingly canceled the agreement to install a link to Napster's online music service on its computers. Instead HP made an agreement with Napster rival Apple to feature it's iTunes store on HP computers and sell Hewlett-Packard branded iPod music players.


On Wednesday, Roxio began laying off people at its Napster division. A Roxio spokeswoman said the company was "eliminating redundancies in the organization'' but declined to say how many people lost their jobs.

"I think it's a very competitive market with very ugly economics and there's just no money in the download business,'' said Steven B. Frankel, managing director of Adams, Harkness and Hill, a Boston investment bank.

Napster declined to provide specific subscriber numbers for its service, aside from noting that downloads and subscriptions each contributed equally to Napster's .6 million in revenue for the last three months of 2003.

That means Napster has attracted about 90,000 subscribers in its first two months -- ranking it fourth, behind RealNetworks' Rhapsody service, America Online's MusicNet and MusicMatch.


Still, Gorog, chairman and chief executive of Napster, is positive as he expects the business will mature when users realize, that it's cheaper to pay a flat fee for access to 500,000 tracks than to pay $ 1 for one song.



I love this...Napster has had more owners in 3 years than my van has had in 12. They all thought they would make a pile of $ from the Nappy name, but these millionaires never got it thru their thick skulls that Napster was built by it's users, and the content was free. I really don't see online music services being worth a damn as I believe the majority of internet users don't listen to top 40 and major label stuff all the time, and no service can provide the range of music on their own without labels sticking their fat greasy hands out for a piece. When will they learn? PPl are sick of their "Trick with no treat" business models and taking on a former P2P filesharing outlet's name will not fool anyone. I knew this was dumb the minute I heard about it...Either I'm psychic or just not as stupid as ppl who have $15 million to lose. You can't expect ppl to pay 9.95 an album for secured content. If I can't play it in anything or make it playable ala rip to WAV I don't wanna pay $10 for it when I can get the album used for a buck less most times!!


Can anyone figure this out? I'm at a loss.

I'd be sort of upset if it did prosper, them fucking Napster's dead and decaying corpse and all.

Lets hope those assholes in the IRAA follow this "losing money" trend. The sooner the better, the more the...more better.

Haha, I had the feeling that this would happen.

I saw it coming.

These services are just dumb, do they think we really want to pay for something we've been getting for free? Maybe if there was a flat fee to pay it'd be worth it...

Flat fee for unlimited downloads is really the only way to go. Personally, I think even $.99 per song is a bit rediculous...

You shouldn't really have to pay more than $5-$7 for mustic, especially since the artist might only get $.25 of each of those sales... and THATS if they are lucky enough to have a good deal where they are making ANY money.

Personally, I wish the "MP3.com" format lived on. Independant artists promoting themselves and selling their own albums, and getting 50% of everything sold. Who really needs the RIAA anyway?

Good. I will not pay for downloads until they make 100% bit perfect songs available for download. MP3 is painful to listen to.

I know I'm gonna get flamed for this but I still think the apple store's pretty decent. 99 cents is a whole lot better than paying $10-$20 for one song and the quality's better than mp3.
I'd love to see a system where artists have music to download on their site for free and we support them from concerts but most of these artist have no idea how to promote themselves.

I totally saw it coming. Not many people are willing to spend money on napster, when they can download files for free of kazaa or bearshare. Napster is the one who pretty much started the trend, and it's ironic that they can't come back.

What the hell music are you buying that costs $10-20 a song??

I'm talking about album's that only have one good song on them.

I think they would have done much, much better if they had just charged a flat, monthly rate with unilimited downloads.

Also, I could be wrong, but wasn't their selection very limited?

Another thing I just thought of as I was cruising around the Naim forum, is why the hell would I pay $9.99 for a full album download, when I can pay a little more for a full resolution edition complete with any extras that may come with the CD and liner notes that I can touch and look through?

the thing is, this comes as no surprise to me or anybody I know. with such a negative image (i.e. "Napster is dead") how could they have expected to achieve success?

the reason why Apple's <a href="http://www.apple.com/itunes">iTunes Music Store</a> is, considering its industry, quite successful is because it has 1) Apple's money, and 2) Apple's brand to back it.

Yeah, exactly. If internet users are going to shell out their hard earned cash for music downloads, the industry needs to offer something better than the alternative. Sure, instant gratification is one thing, but why pay the same amount of money for a digital copy when you can go out and get a CD with artwork and whatnot?

P2P sharing > Buying CDs > Buying downloads

a lease with bellsouth dsl has gotten me access to more mp3's, movies, cartoons, anime, basically EVERYTHING through a FREE newsgroup subscription that's included with the lease. when people pay for high speed service, and recieve this kind of server access as a benefit, who care if "dsl users download a song in one minute for less than a dollar"? p2p was a great concept until the industry cash whores bought a piece of it. people with the iq of a jar of mayonnaise might be dumb enough to pay for this, but even without competing music downloads such as kazaa and tesla, plus innumerable others, it's still easier, and cheaper, to buy a cd used OR new. at least then you can rip it, burn it, customize it, etc.

Exactly. When I shell out my 20 bucks for a CD, I expect to get album covers, the case, CD art and possibly an extra something on the CD itself.

yea, thats why i gave up burning cds before it even became illegal. sound quality isnt as good, you dont get the covers, and usually u cant find every song on kazzaa anyways. i myself kinda feel bad for napster though... 14 million is a lot of money

the thing i don't get is i work my ass off in college trying to get a degree so i can get a better job and live a better live. those mother fucker artist, like Britney Spears, Justin Timberlake, 50 cent, who happen to be winning a lottery, make tons of easy money. why would my hard earn money be going into their pockets so they can living large? i'm pretty sure there are a lot of people out there that can sing, perform, but because they are not lucky enough to be in the bniz and their talents is waste. think about it, if we cut down the artist salary and have more competition, we would get more musics, and more variety with lower cost. artist don't need to live with 50+ mil in their bank. i can live with 1 mil, for the rest of my live and probably making more by investing it. the idea of making artist decamillionaire is really nonsense.

Do not be deceived. This thing is NOT napster. It's actually Roxio, the makers of EZ-CD creator using the napster name. Napster, to me, will always be synonymous with a good thing, and clearly this DRM - Windows Media Player only - have another helping of M$ shoved down your throat - crap is nothing like that.

Re: Napster 2.0 lost 15 million dollars in the first 2 months.
 

Interesting that iTunes is not mentioned... probably because they don't have 'subscribers'. Apple truly owns the music download system, because they are using it as a loss-leader to sell iPods and Macs.

Agreed 110%. I miss the old Napster...It was new, easy, and the best jukebox I had for a really long time. Oh, and for awhile it wasn't even questioned if it was legal or not.

Yea this is too true. In my previous posts on these topics you'll often hear me mourn the passing of emusic.com.. well its still alive but Universal acquired it and changed it from a flat fee unlimited download (no drm) music service with indy labels to a flat fee limited download music service with major label crap (to its credit they decided not enforce any DRM, they are still plain ol mp3 downloads).

Unless a service comes close to what emusic USED to provide, I cant see myself using them. Im not holding my breath though. Something I might go for would be a service with unlimited downloads for artists older releases, while keeping their new release(s) on a pay-per-download status (until they come out with a new release).

There is just no way that anyone is going to convince a majority of internet users that we should be paying for music downloads.

Ads on TV won't work.

Lawsuits won't work.

Appeals to save the "starving" artists won't work. (watch MTV cribs a few times, that'll really bring out my sympathetic side)

Brittney Spears going door to door giving blowjobs wo~
Ok, that would work.

napster was never about the name. it could have been called "softwarethatfindsmp3s" and been just as cool. Roxio and the others are dumb for thinking that the internet community would adopt Napster 2.0 the same way it did it's predecessor. Napster was a statement...not a label.

Napster, what was once the best source of free music on the net, started losing money when they started charging people. Somehow I am not suprised! I personally feel that Napsters reputation in the past with all the law suits etc. has scared people despite the legalizing. Would rather use a service like iTunes, which has been legit from the start, because they feel safer.