| Friday, August 4, 2006 |
19:17 - Imagine that
http://ilounge.com/index.php/news/comments/napster-subscribers-decline-company-consi
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Napster shedding subscribers like a winter coat and pondering selling itself? Say it ain't so!
Napster said yeterday that it wouldn’t rule out a sale of the company after reporting that the subscriber base for its online music service had fallen 7 percent. “We do not have our heads in the sand regarding an M&A (merger and acquisition) transaction. We continue to receive a lot of interest in the company. We will always carefully weigh any valuation alternative against the opportunity and risk associated with continuing as a standalone company,” Napster CEO Chris Gorog told analysts on a conference call. Napster reported a net loss of $9.8 million for its first fiscal quarter. The company’s total paid subscriber base as of June 30 was 512,000, including 4,000 university-paid subscriptions.
This doesn't come as a surprise to anyone who's paying attention; what does have me blinking in shock is that after all this time, nobody has apparently bothered to take advantage of the obviously hackable hole in Napster's subscription model.
That's the one where you subscribe (for $14, or using the free one-month trial—either way it's not a lot of milk money), download as many gigabytes of music as you want, transcode them and burn them all to MP3 CDs, and repeat until your month expires. Total outlay: $14 max. Total gain: How big is your hard drive?
(As opposed to the Apple model, where just to get the file off the server you have to fork over the dollar, making the risk of piracy through transcoding a thoroughly linear one, and not worth a pirate's valuable time.)
All I can think is that pirates really don't have any personal interest in making MP3s off of legitimately DRM'd music, to share over P2P out of the goodness of their hearts. I'd grown accustomed to the assumption that every l33t h4xXor wanted to have his name in lights as the Grand Master Music Source or something, with his callsign branded into every purloined file, with shout-outs to all his homeys in Mrs. Biggles' pre-algebra class. But maybe that's just not the incentive I'd thought it was. Maybe people really are in it just to acquire music and get on with it. And in the real world, when your files come from 45 anonymous peers all over the world, and you can type in a song title and get a zillion matches in ten seconds, who cares who originally made himself the community's benefactor by throwing himself on that $14 grenade? Chances are someone just ripped a CD anyway and that's the MP3 everyone's downloading now.
But that's small comfort to Napster and friends. (I wonder what those "iSheep" people at SanDisk think about this?)
Via Daring Fireball.
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Brian Tiemann
