The details are not disclosed, but it looks like Rhapsody has come to an agreement with Best Buy to take over Napster service. Of course, this is Rhapsody’s attempt to counter the surge of users on Spotify.
Napster was founded in 1999 by John and Shawn Fanning. Of course, issues arose with the downloading of illegal music, which was brought to the forefront by the band Metallica. The peer-to-peer sharing site went bankrupt in 2002, then sold their assets to Roxio, who then sold the company to Best Buy.
Rhapsody has also been in the music space since 2001. Their music streaming service has gone through a few changes, but survived for over ten years. So when Spotify brought a surge to the online streaming service category, it would make sense that Rhapsody would want to counter.
“This deal will further extend Rhapsody’s lead over our competitors in the growing on-demand music market,” said Jon Irwin, president, Rhapsody. “There’s substantial value in bringing Napster’s subscribers and robust IP portfolio to Rhapsody as we execute on our strategy to expand our business via direct acquisition of members and distribution deals.”
The only thing we know from the details is that Best Buy will still keep a stake in the company. That could become a great marriage for Rhapsody, because Best Buy has been known for putting bundles into their product sales. Getting someone on a service for a couple free months and hope they don’t cancel the membership when the time comes.
Currently, Rhapsody and Napster are the two largest on-demand music services. With the acquisition, they will be able to run against Spotify and the Facebook integration.
The deal will be finalized on November 30th.