LOS ANGELES (AP) - Napster Inc. begins selling MP3s Tuesday, a move the
online music service hopes will lure iPod users and turn around Napster's
sliding fortunes.
The company is the latest to make the switch to the unrestricted file
format, which makes it music tracks compatible with virtually any music player
or other device.
"It's great that we have finally gotten here," said Chris Gorog, Napster's
chairman and chief executive. "It is really the beginning of a level playing
field, which I think is essential for Napster, but also for the health of the
digital music business in general."
Tracks downloaded as part of Napster's subscription service will continue to
have copyright restrictions.
For much of the decade, major record labels refused to license their music
for downloading as MP3s. But steep annual declines in CD sales and the growing
dominance of Apple Inc.'s iPod music players and its iTunes Music Store led the
labels to ease that position last year to remain competitive.
Amazon.com is the only other retailer offering MP3 downloads from all the
major record labels.
ITunes began selling MP3 versions of recordings from artists on EMI Group
PLC labels last year, but the tracks are more expensive and higher quality than
standard copy-protected versions.
Napster MP3s will be priced at 99 cents each, while full-album downloads
will start at $9.95, the company said.
Rob Enderle, principal analyst with the Enderle Group, said he can't picture
many iPod and iTunes users shifting to Napster, since iTunes software is so
integrated with Apple music players.
The exception may be someone looking for a track that Apple doesn't offer,
he said.
Napster might have a better shot competing against Amazon, which isn't
solely focused on selling music downloads.
"Napster's brand and focus on the medium should give it an advantage,"
Enderle said.
Gorog said Napster plans to differentiate itself from rivals through a
modest marketing campaign that emphasizes it has the biggest catalog of music
licensed for downloads.
Napster boasts a catalog of more than 6 million tracks. Amazon says its
catalog exceeds 5 million tracks.
Los Angeles-based Napster, which first disclosed its plan to shift to MP3s
earlier this year, is also betting that an all-MP3 download store will entice
some buyers to sign up for its all-you-can-eat music subscription offerings --
the firm's bread and butter.
Napster recently said it had about 760,000 subscribers as of March 31.
Napster shares closed at $1.54 Monday after rising a penny, or 0.65 percent.
In the past year, the stock has traded between $1.33 and $3.92.
Copyright 2008 Associated Press. All rights reserved. This material may not be
published, broadcast, rewritten, or redistributed.
|