At the end of last week Napster, the resurrected subscription music service that's been on sale for some time now, made a deal to buy its way into AOL Music.
For $15m Napster gets to replace AOL Music Now with its own service, meaning that it has just taken on some 350,000 paying subscribers (here's the Reuters report. Profits are bleak at the company and it has been up for sale for some time, although it's supposedly got a large investment war chest in the bank. But is paying for greater exposure a route to success?
Over at Techcrunch, Michael Arrington says he's not sure:
It's unusual to see a company make acquisitions when it is itself on the market. Maybe this is Napster's signal that the sales process isn't going well. Or perhaps they just took this opportunity to further consolidate the market.
Personally, I think Napster's business should be healthier than it is; the problem is that music providers like this have a lot of paymasters and very little profit. And the last time I used it to download anything, the weight of DRM on the tracks was so heavy that it more or less crippled them. But what is Napster up to?
Maybe things will become clear later this week, when I'll be talking to Napster boss Brad Duea. If you've got any questions you'd like to ask him, leave them in the comments below.
