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Sat, Nov 21, 2009 - 03:55 PM EST  —  AAPL: 199.92 (-0.59, -0.29%)  |  NASDAQ: 2146.04 (-10.78, -0.5%)

Why ‘Napster To Go’ will flop
Thursday, February 03, 2005 - 07:23 PM EST

"On the surface, the To Go model looks like a great replacement for Napster's previous subscription service. In the past, customers had to pay a monthly subscription fee that allowed them to rent as much music as they liked. Users then had to pay extra to download permanent versions of songs that could be transferred to a device or CD. Now, $14.95 per month lets you download as much music as you like to your computer and/or device," Ashlee Vance writes for The Register. "The big detractor, however, is that you still don't own the music. You rent it. Stop paying the Napster tax man, and all your music disappears."

"This forces you to make a choice between quantity and permanence. Pay Napster every month and gain access to an almost limitless supply of music or buy select CDs, as you have in the past, and own them for years," Vance writes. "From where we sit, the math doesn't break down terribly well in Napster's favor."

Vance looks at a number of hypothetical customers and finds Napster To Go doesn't really work very well for any situation.

Vance continues, "Even Napster seems to realize the vacuous nature of the deal. 'A fully-integrated marketing program will support the release of Napster To Go, led by a currently-under-wraps February 6, 2005 Super Bowl television advertisement,' it says in a press release. 'This will be complemented by the new 'Works with Napster To Go' logo program that enables consumers to easily identify Napster To Go compatible MP3 players at retail.'"

"What is this marketing program integrated into? Is it possible to have a partially-integrated marketing program? Are we to be excited by logos now? When the bullshit generator goes this far into overdrive, you know there are problems," Vance writes. "Napster plans to spend $30m to promote this new service. That's a cute total if you consider that Apple made close to $14m a day last quarter in iPod sales, shipping 4.6m devices. The only money to be had in this market is in the hardware, and Apple has it all locked up. Here's hoping consumers will see the light and Napster To Go will go away."

Full article here.

MacDailyNews Take: Ditto.

Related MacDailyNews articles:
Napster CEO: We're 'the biggest brand in digital music, much more exciting than Apple's iTunes' - February 03, 2005
Napster tries to push music subscription service over pay-for-download iTunes-like model - February 03, 2005
Apple Computer could sell 21 million iPod shuffle units in 2005 - January 19, 2005
Cornell University's Mac users 'uniformly unhappy' with Napster - January 19, 2005
Analyst: Apple's iTunes Music Store 'downloads could reach 474 million in calendar 2005' - December 17, 2004
Study: Apple iTunes Music Store dominates with 70 percent market share, second place Napster holds 11 percent - October 19, 2004
Cornell University wrestles with Napster's exclusion of Mac and iPod-using students - September 08, 2004
Why are Cornell's Mac students being forced to pay for useless Napster? - September 07, 2004
Napster schools to Mac-using students: bend over and take it - September 04, 2004
Napster CEO: 'it would be great' if Apple iPod supported WMA - March 09, 2004
Napster CEO: Apple iTunes, iPod 'consumer-unfriendly experiences' - March 09, 2004
Microsoft tries to push WMA by propping up beleaguered Napster - February 25, 2004

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Feb 03, 05 - 07:43 pm Comment from: rawfish

Great article! Everyone should go and read it!!!

Feb 03, 05 - 07:45 pm Comment from: Kevin

Great article. It's good to see viewpoints like these in mainstream media.

Brought to you by the magic word into, as in "Apple's going to jam the knife INTO Napster's back!"

Feb 03, 05 - 08:02 pm Comment from: devnull

Works with Plays for Sure..?

Plays to go..?

Napster for sure...?


Or just get an iPod.

Feb 03, 05 - 08:05 pm Comment from: Jump

Me, I'm still interested in a subscription service. Not as a means of purchasing music but as a means of previewing and exploring music. I'd be willing to spend $15 per month to review as much music as I could ever wish for. When I find a new artist I like, I have no interest in downloading the poor quality of ALL compressed music. I'll go buy the CD thank you. Unfortunately, I want it on my iPod and Mac. Not on my PC or some other music player so I have to hope that Napster is successful enough for Apple to decide to pursue a similar service.

Feb 03, 05 - 08:28 pm Comment from: Frank

Ok I'll bite: can someone "do the math" for me a convince me that not owning/must plug in mp3 player every 30 days/15$ is a good deal?

Feb 03, 05 - 08:30 pm Comment from: blah

"This will be complemented by the new 'Works with Napster To Go' logo program that enables consumers to easily identify Napster To Go compatible MP3 players at retail."

What is it with the Windows world and logos and stickers? They are obsessed with them like 12 year old girls.

Now they can have complimenting sticker sets with their eMachines PC and their Dell Junkbox!

Feb 03, 05 - 08:47 pm Comment from: oldmacfan

14.95 X 12 months = "Neal and Bob"

That's like paying a Hooker and doing what she says.

Feb 03, 05 - 08:54 pm Comment from: Snugfig

OH puh-leeez! ANOTHER logo -validating program? "Plays for Sure" and now "Works with Napster-to-Go". BY the time all of these companies slap their seal of approval on future digital mp3 players, they will have to increase the size of player and the box so that you can read all of the logos.

hahahahaha. This is too funny.

keyword = rest, as in Napster should give it a rest already

Feb 03, 05 - 09:08 pm Comment from: retro cat

Frank,

Here's the math:

If you are 20 years old, own no music, and are going to live until you are 75, the cost of renting assuming a historic rate of inflation of 3% is $24,411.

If you assume you will buy about 840 CD's in your life, the cost is around $12,591. (Again allowing for inflation.)

So, you'll save over $11,800. Plus most people own far less CD's than 840.

Napster is playing math games. They are saying it costs 10 grand to fill an iPod, but that is misleading. Most people buy albums and already have music. No one fills an iPod with individually bought songs.

Plus, as I just showed you, there is a break even point when renting just becomes more expensive than buying.

Finally, you own your music. You can do with it as you please. (Even Apple's DRM is notoriously weak. Apple winking to its customers.)

I hope this was helpful.

Feb 03, 05 - 09:22 pm Comment from: Chris White

I particularly liked this phrase:

"Customers do not, as Napster suggests, pay $10,000 to fill their iPods with 10,000 songs just because the capacity is there."

Why can't more analysts or experts pick up on this fact.

Feb 03, 05 - 09:28 pm Comment from: effwerd

When the bullshit generator goes this far into overdrive, you know there are problems

Ha. My bullshit generator has burned out but somehow still manages to work pretty well.

Feb 03, 05 - 09:36 pm Comment from: JadisOne

When the bullshit generator goes this far into overdrive, you know there are problems

Classic.

Feb 03, 05 - 09:43 pm Comment from: JadisOne

effwerd, I see we were on the same page. grin But you beat me to the punch.

Feb 03, 05 - 10:11 pm Comment from: Reggie Jackson

14 or 15 dollars per month for 12 months ? What's that like 180 dollars. Every year, and after a few years you've got 500 smackers locked up in Napster...then you stop paying for a month...whammo - you got exactly squat for tunes. Only a retard would do this. Seriously, if you get someone to pay for you, maybe. But even then - you have zippo tunes down the road.

Napster = a gimmick to lock up the retards with short sighted logic.

Feb 03, 05 - 10:18 pm Comment from: Larry Singer

Well....I must admit when I heard the news that I was wondering if Apple had reason to sweat. I suppose not.

But then again...we are talking about the lowest common denominator that will be subscribing...the people who DON'T have iPods.

I would think this would be an ideal option for businesses who pay $100/month for services to pipe music in to their sound systems.

Otherwise..people wanna own their music.

What's to stop people from figuring out how to get the songs off their player? It can be done with the rock-solid AACs (turning them in to tradeable mp3s) and taking songs off your ipod.

Feb 03, 05 - 10:37 pm Comment from: NoPCZone

And what happens to all of your rented music if Napster 2.0 goes belly up like Napster (original theif-ware)? Can you say "Screwed For Sure"?

Feb 03, 05 - 10:44 pm Comment from: Buffy

For $0 i can listen to all kinds of random music from all kinds of genres, its called internet radio, and they do the random thing for you. Tehn pay 99ยข for the ones you like.

And as they said in the article, you already have a music collection built that you are adding to. The only people this works for is teen who purchase a new album every week because its new and cool. Except when your out of high school, and your parents arnt paying your bills anymore and move, your music will just dissappear, and you will be left with nothing. I have a nice CD collection i started @ 16, combine that with your spouse's and look at all the music you could have had.

As Most people who have a large collection do, I probably listen to the older stuff more. And its great going back and rediscovering old music you listened to back then

Feb 03, 05 - 10:45 pm Comment from: BuriedCaesar

When you rent or lease a car, you pay to use it until you return it. Then you have no car.

When you rent an apartment, you pay until you move out. There is no benefit after you leave and must find another place to live.

When you rent music, you listen until you quit paying. Then the music is no longer available, unless, in Napster's crazy world, you choose to pay for it again. Where's the logic in that? Who wants to pay twice for one item?

I'd rather own my car, own my house, and own my music the first time 'round.

My magic word: "reason" -- Hmmmmmm..... oh oh

Feb 03, 05 - 11:02 pm Comment from: Less is More

Definitely a flopper. Even allowing for inflation, if retro cat didn't allow for the time value of money you can multiply that by 3 to 5, I guess.

The Unofficial Apple Weblog has a cool sticker for the iPod shuffle. Click on the small graphic and print the full-size image on a sticker. I wonder if this will catch on....

Feb 03, 05 - 11:20 pm Comment from: smorr

Another key point is that when you own music, you are protected from the price jumping up. I'll be laughing hard at all the poor schlups who rented there music at $15 a month and find that down the road the Napster changes its price to $20 a month, $25 a month, $29.95 a month whatever. -- and that the renter has no option but to pony up or lose all their music.. If they switch to a different service (aka MSN Music store) or whatever, they have to go through the hassle of downloading their collection again...

If, like in ITMS, you buy a song for $.99, it is bought for good and that price won't go up.

PS. Something is really screwd up with the magic word -- I had to reload 3 times for it to work. -- it is like a tag is not closed properly on an adserver. bad bad bad

I am also waiting for the DRM crack that will render Janus completely ineffective. I wonder what would happen to Napster, MS, bottom line etc if the DRM was cracked and basically all rented songs become 0wn3d. There goes that business model. Then what do they do... disable songs, force people to download new songs (like they would) force people to upgrade their music software, or force people to upgrade their mp3 player -- anything that runs the cracked DRM music won't play post-cracked DRM music.... PlaysforSure????

Not only is renting music a risky move for consumers, it is a risky move for the providers. I would be a bottom dollar that there are going to be a lot of troubles where customers and corporations will be pitted against one another to keep prices down and force upgrade paths. ugly.

Feb 03, 05 - 11:50 pm Comment from: Jack A

Wow, she really spanked Napster.

MDN PLEASE FIX THE MAGIC WORD POP UP PROBLEM (MAWPUP)!!!!

Feb 04, 05 - 12:03 am Comment from: Jack A

That the "plays for sure" logo come from M$ is really ironic. Do their computers "run for sure"? I think not.

Feb 04, 05 - 12:04 am Comment from: Jack A

MDN fix the MAWPUP!!! I am on a Mac but this kind of thing happening makes me feel like I am on a Windoze machine.

Feb 04, 05 - 12:24 am Comment from: BuriedCaesar

Jack A - that comment about "runs for sure" was really low.

Okay, I can't lie - I totally agree. Wish I'd said it first.

Feb 04, 05 - 03:28 am Comment from: Less is More

No MAWPUPs on iCab if you have it.

Feb 04, 05 - 05:12 am Comment from: It's a Mac

the MAWPUP might be a pain, but all the sites it goes to are good for you.

Learn more, help people. Don't just sit there at the damn computer all day.

How about:

Social Education Pop Up Pages

SEPOP

ps I think the MDN magic word dbase is weighted towards social rebellion, and subversive.

Feb 04, 05 - 05:27 am Comment from: Child-of-Old-Style-Napster

Let me recap:
I'm going with "Napster to go" for one month for $15.
I'll buy a small hard disk drive (say 80 GB) for $75.
I'll buy 1000 blank CD's for $160.
I download my favourite 17.000 Songs, invite friends to a "burning"-party and burn my songs to discs.

Spend $250 once, and you'll legally obtain enough music to fill all your future iPods.

Feb 04, 05 - 05:37 am Comment from: Child-of-Old-Style-Napster

I was stupid, wasn't I?
Of course Napster is charging extra, if I want to burn my music on disc.

Feb 04, 05 - 06:04 am Comment from: Macaday

Original Napster was stealing from the record companies...

New Napster steals from its customers...

Ironic...

Ought to be $1 per month after one year. 50c after 2 years and 25c thereafter. Even then it would still be a pain.

Feb 04, 05 - 06:44 am Comment from: Wingsy

Would someone be kind enough to explain WTF the MAWPUP problem IS??? Is it some kind of pop-up window you people are seeing? (I for one don't see any popups... Safari with popup blocking ON)

Feb 04, 05 - 07:20 am Comment from: Jump

Buffy, the problem with internet radio is you can't choose what you want to listen to. For example, you hear an artist that sounds interesting and you want to hear another song by them what are you going to do? You have to go buy a crappy download from someone. No thanks.

$10 per month for satellite radio where you can only pick the genre or $15 per month where you can pick and choose what ever you want to check out and explore in any way you want to. With either service, you don't own the music (of course, Audio Hijack could fix that). The price doesn't seem that far off for the difference in how you can choose the music.

I'm still hoping Napster is successful with this so Apple has to follow!

Feb 04, 05 - 07:28 am Comment from: Jump

I will add that I think it would be stupid for people to use this service to "create" their music collection for all the reasons mentioned above. And of course, that this very thing is what Napster is promoting. I'm promoting it as a means of finding and discovering music that I like enough to go out and buy the CD.

iTunes isn't getting my money now. With a service like Napster's they would.

Feb 04, 05 - 08:16 am Comment from: Harry

Well, I think it is not that dramatic : Use something like WireTap to re-record the sound part you like. Put the recorded piece back in iTunes and burn a CD.

Feb 04, 05 - 09:17 am Comment from: max

"Napster to Go," Bullshit Generator. Any similarities here?

Feb 04, 05 - 10:16 am Comment from: zupchuck

I like Junp's take - I think all downloaded music sounds horrible (at least if you want to play it on a decent stereo). A subscription would allow you to explore different venues while still staying legal. I'd still want a downloaded format that retains the original quality of the CD before spending my money, though.

Feb 04, 05 - 10:59 am Comment from: John

This story is right on the money! Napster to go away should be there marketing program. I don't want to rent my music.

Feb 04, 05 - 11:46 am Comment from: Buffy

YOu want to pay someone to ALLOW you to explore music? If thats all your doing and are planning to buy, Hell, download a low quality version of a couple of song, or find a friend who listens to it. I wont pay the car dealer to take a test drive. Its THEIR JOB to try to get me as a customer. I think that song previews should be a whole minute, so you can get a real feel for the music, not just a cool riff

Feb 04, 05 - 12:33 pm Comment from: Ryan

I think this is an OK deal to AUGMENT, not REPLACE iTunes / conventional CD sales. I currently pay monthly for XM Radio, Cable, and DVR service. In other words, paying for entertainment services by monthly subscription is very common. I would like Napster better if it was $9.95 and if they gave me a fat rebate on a player for a 1-year contract (a la cell phone companies).

But would I stop buying CDs? Definitely not. Would I shelf my iPod? Of course not.

Feb 04, 05 - 01:51 pm Comment from: Michael Simpson

Why not just subscribe for one month, download all of the music you want to try out, and re-record all of the music you want to keep to aif or wav or even to minidisc? If you then encode the music at a high bitrate, it should sound just as good as the original wma files. Sure that can be done with current P2P systems. But Napster can make it a hell of a lot easier. I could download thousands of tracks to my PC, play and record the good ones to my Mac. Sure it takes a little more effort--but not nearly as much as finding songs using P2P services.

Not that I plan to do this, but I don't mind pointing out a scheme which will use Napster's dumb ideas against itself.

This along the lines of my previous suggestion that the students at Florida State just share their iTunes libraries with each other for the ultimate, free streaming service.

The attack on music consumers really needs to end. And Napster's half-baked crappy ideas aren't going to get us there.

Feb 04, 05 - 02:07 pm Comment from: cricket

repost of something i wrote in the other napster thread:

this might work for the first few months. new user signs up and spends tons of time tracking down music he likes and looking up new stuff. fills up his mp3 players. then after a while, he's already downloaded everything he wanted. he looks at his bill and thinks to himself "why am i paying $15 a month when i haven't even downladed anything new in so long?" then he gets pissed that he's paying so much just to LISTEN to his music.

someone said above that this will appeal to wal-mart consumers. i completely disagree. the typical wal-mart music listener listens to pre-packaged over-commercialized top 40 songs. those are the people this would be LEAST useful for. they can fill up their 40 gig players will all the latest eminem and hillary duff in less than a month.

the people it MIGHT appeal to are those who are always looking for something new and something different. unfortunately, these are also the people who feel the most strongly about owning their music.

if this were positioned as an "unlimited preview" service, then i can see a market for it. but napster is trying to position this as the alternative to itms and it's going to fail miserably in that category.

Feb 04, 05 - 07:11 pm Comment from: Jump

Sorry Buffy, the car analogy is a poor one. To me anyway, a car is a product, music is an artform. Would I pay to go into an art gallery to preview the different pieces prior to making a purchase? Yes I would. Not only am I supporting the art (and the ability of the artist to continue to create the art financially) I am also getting a chance to get a good look at the art piece rather than a 30 second shot on the computer.

We're obviously looking at this from very different angles. For me, one of the great experiences is finding a new musical artist that just blows me away. They are hard to find and I've wasted a lot of money on a lot of CD's trying to find them. A music service similar to Napsters would not only allow me to find many more of those unique artists but would save me money as well as space in my CD storage bin.

Feb 05, 05 - 07:27 pm Comment from: Jeff

Napster cost $15 a month only if you want to load it on a portable device. For $10 you can download, or stream, whatever you want on your home PC. For $0 a month you can listen to samples and buy 99 cent downloads just as with iTunes. So they are offering the same service as iTunes, plus additional functions for people that like to listen to more music. What is wrong with that? Why can't iTunes offer a similar service for those of us that want it?. If you are happy listening to clips, then Napster is the same deal as iTunes. That Napster subscription is good for 3 machines so you could split it with 2 friends; $3.33 each for unlimited listening.

It is similar to XM radio except you get to choose the artist. I have no interest in buying a download; if I like the band, I will go to Amazon or ebay and buy a used CD. That's just what works for me. It saves a lot of money on CDs I listen to once and lets me broaden my horizons. Don't want to be listening to Crosby Stills ans Nash in the old folks home.

Feb 06, 05 - 11:17 pm Comment from: Test

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