Feeds

Best Buy snaffles Napster

Retailer fancies 'platform'

Secure remote control for conventional and virtual desktops

Napster's board has unanimously accepted a takeover bid from US retail behemoth Best Buy, worth $120m. Thus ends a bumpy four-year ride as an independent company.

Like Frankenstein's monster, the reanimated Napster was constructed from the parts of formerly deceased music companies. Software vendor Roxio acquired the assets of the bankrupt rebel P2P outfit for just $5m in late 2002, and acquired the remains of Sony's unsuccessful music service PressPlay six months later. After the injection of electricity, and $20m, Napster went live five years ago this month.

Promoting a rental music service has been hugely expensive. Faced with marketing expenses that at times reached 85 per cent of its total spending, Napster has not been profitable. It has been better at managing its cash than many suppose, however: In its most recent quarter, Napster lost $4.4m on revenue of $30.3m - yet ended the quarter with around $70m in cash.

Yet the market trend isn't promising.

Revenues are static, year-on-year, and much of Napster's steady revenue (and 700,000 subscribers) comes via higher education deals, where a subscription is compulsory. If the mooted plan to legalise P2P in US universities through collective licensing becomes a reality, than that revenue source is set to disappear.

Not surprisingly, then, Best Buy's president talked up Napster's "platform" and mobile potential in a prepared statement - and said nothing about its consumer brand.

"Best Buy is uniquely positioned to benefit from Napster's digital entertainment distribution platform. We are looking forward to combining our digital media capabilities with Best Buy's resources and global network to extend our digital content platforms," he said.

I think we get that message.

As an indication of how hard Napster tried to convert the public to paying for rented music, here's a poster campaign from 2005:

Napster: 'Own Nothing - Have Everything'

That worked out well, then.

Best Buy recently pumped $1bn into a joint venture with Carphone Warehouse to expand the mobile phone chain into consumer electronics. ®

Secure remote control for conventional and virtual desktops

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
No, thank you. I will not code for the Caliphate
Some assignments, even the Bongster decline must
Fast And Furious 6 cammer thrown in slammer for nearly three years
Man jailed for dodgy cinema recording of Hollywood movie
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Endpoint data privacy in the cloud is easier than you think
Innovations in encryption and storage resolve issues of data privacy and key requirements for companies to look for in a solution.
Scale data protection with your virtual environment
To scale at the rate of virtualization growth, data protection solutions need to adopt new capabilities and simplify current features.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?