Feeds

Napster hoists 'For Sale or For Partner' sign

Can we offer you a cute logo and losses?

Choosing a cloud hosting partner with confidence

A brave Napster is willing to keep pounding away at the unprofitable online music market. Er, unless someone wants to buy the company.

Napster today revealed that it has hired UBS Investment Bank to sort through partnership and acquisition proposals for the company. Rumors of such a play first appeared in February, at which time Napster CEO Chris Gorog vehemently denied that the company was seeking a buyer. It would seem that hemorrhaging cash over the past seven months has changed Gorog's - forgive us for this - tune.

Sort of.

"Napster is in a strong position to continue aggressively building our business as an independent company and we are pleased to also have the opportunity to thoughtfully examine potential combinations that may further enhance Napster's unique strategic and brand position in the center of digital media," Gorog said. "Our goal is to enhance shareholder value which could potentially lead to a new strategic partnership or the sale of the company but in any event our primary focus will remain on growing Napster."

In the near-term, Napster's public flirtation with potential suitors has sure done the trick. Shares of Napster surged more than 12 per cent, at the time of this report, to $4.00 in the after-hours markets.

Try as it might, Napster has failed to develop anything resembling a healthy business model since it went "legal" with a music subscription service. The company claims $100m in annual revenue and more than 500,000 subscribers. Such totals haven't been enough for Napster to turn a profit, and the company continues to eat away at its cash stockpile, which is now down to $97m. In its most recent quarter, Napster lost another $10m.

To be fair, most of the subscription players have struggled to find the black. Apple has taken the vast majority of profits in the online music realm via the iPod. Meanwhile, the subscription crowd - and Apple via iTunes - must fight over a few pennies per song in profit.

You have to wonder if Napster's customer base is really worth the effort for a company such as Microsoft or even Real. The Napster brand has all the gravitas of a Che Guevara t-shirt.

You can keep putting lipstick on a dead cat, but it's still a dead cat, as the saying goes.

But in these days of bubbling Web 2.0 jargon and loose venture capital, we're sure some company full of ambition will be willing to take on Napster's business model and college music freeloaders. ®

Beginner's guide to SSL certificates

More from The Register

next story
Xperia Z3: Crikey, Sony – ANOTHER flagship phondleslab?
The Fourth Amendment... and it IS better
Don't wait for that big iPad, order a NEXUS 9 instead, industry little bird says
Google said to debut next big slab, Android L ahead of Apple event
Microsoft to enter the STRUGGLE of the HUMAN WRIST
It's not just a thumb war, it's total digit war
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Netscape Navigator - the browser that started it all - turns 20
It was 20 years ago today, Marc Andreeesen taught the band to play
A drone of one's own: Reg buyers' guide for UAV fanciers
Hardware: Check. Software: Huh? Licence: Licence...?
The Apple launch AS IT HAPPENED: Totally SERIOUS coverage, not for haters
Fandroids, Windows Phone fringe-oids – you wouldn't understand
Apple SILENCES Bose, YANKS headphones from stores
The, er, Beats go on after noise-cancelling spat
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.