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“Napster” Returning from the Pet Sematary

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We mentioned a couple of days ago that Roxio might buy Pressplay - it’s happening:

    Software maker Roxio Inc., the new owner of Napster, has acquired the music service pressplay — laying the groundwork for a competitive Windows-based offering against Apple Computer Inc.’s online music store.

    Roxio, best known for its CD-burning software, said Monday it acquired pressplay, a venture jointly owned by Universal Music Group and Sony Music Entertainment, for about $40 million.

    The company said it plans to use pressplay as the foundation for a new online music service under the name that set Internet music file-swapping in motion. The deal means Universal and Sony will become minority owners in a service named after their former nemesis.

    “This is Napster’s second coming,” said Phil Leigh, an analyst with Raymond James & Associates. “The record labels crucified him, and now he’s going to come back and be their savior.”

    The new service will “retain the overall feel and vibe of Napster,” said Chris Gorog, Roxio’s chairman and chief executive. He would not elaborate on details, including whether the new Napster would include the famous file-swapping technology that upset the record industry and doomed the company in a sea of copyright infringement litigation.

    …While the new Napster could become a major online music outlet for Microsoft Windows users – with a catalog of music from all five major record labels — analysts say many challenges lie ahead.

    For one, users associate Napster with “free music,” said P.J. McNealy, analyst with Gartner G2. “Roxio is going to have to spend quite a bit of money re-establishing the Napster brand … as a pay-for-music service,” he said.

    Because of Apple’s success with less copy protections, the record industry will be willing to cut similarly liberal licensing deals with Roxio and other online music sellers, Kenswil said. [AP]

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