“In October, after a period of testing with 45,000 beta users, Napster relaunched as a legal download site with a library of 500,000 songs – ‘the world’s largest,’ Chris Gorog, Napster CEO says. It offers subscriptions for US$9.95 per month, or simple downloads at 99c per track or US$9.95 per album. In the United States, the only country where it operates, it’s in second place, a long way behind Apple’s estimated 75 per cent of the business,” Charles Arthur reports for The New Zealand Herald.

[MacDailyNews note: Apple's iTunes Music Store has over 500,000 songs available currently.]

“This dominance by a company that has only a tiny slice of the computer market is [due] to its users: they’re just too eager to adopt new things,” Arthur reports. “‘We think [Apple users] could be as much as 25 per cent of the online music business in the US,’ says Gorog. That’s remarkable, given that there can’t be more than a few million machines able to use the iTunes Music Store. ‘In part, it’s because Apple were first to market, entered the market seven months before Napster, with a device [the iPod] that has trapped their audience so that there’s no place for them to go other than iTunes.’”

“Why should one bunch of computer users be so much more eager to take up this technology than another? ‘Macintosh users are historically early adopters of technology, and the online music business is still in the stage of early adoption,’ Gorog says… Yet even at this early stage of the race, Napster has a number of disadvantages compared with Apple,” Arthur reports. “It’s a lot smaller, and has less cash: Roxio has just US$60m in the bank, compared with the US$5bn or so in Apple’s. It can’t do the big advertising splashes. Its US launch was accompanied by small teaser cartoons using its logo. It can’t rely on a dedicated audience, as Apple can with its computer buyers. Users of the original Napster have migrated to new file-sharing networks, or just grown up and bought the CDs. And it can’t generate extra profits on selling associated hardware, as Apple can from the iPod.”

“Ah, the iPod – which, like Apple’s iTunes software, does not play files encoded in Windows Media Audio (WMA) format, used by virtually every online music store, including Napster. Would Gorog like the iPod to support WMA? ‘We think it would be great!’ he says, which almost certainly means Apple won’t. ‘We believe that Apple is very vulnerable for the reason that their service is only available to people with an iPod,’ he says. (If you want to put music from the iTunes Music Store on to a portable player, you need an iPod; but you can also burn it to a CD.) ‘If you buy an iPod, you’re trapped in the iTunes store. That’s like being told that you can only go into HMV’s store, and never Virgin,’” Arthur reports.

“The weakness in this argument is that if both HMV and Virgin sell the same repertoire, who cares which store you’re locked in? What matters now is visibility,” Arthur reports. “Napster lost a big opportunity late last year: HP had been about to sign a deal that would put Napster on every HP computer. That didn’t happen – and instead in January HP signed with Apple to pre-install the iTunes software on its machines, and resell the iPod. Gorog seems unhappy when asked about the implications of this. ‘I don’t know what you’re referring to,’ he says. ‘We never comment on deals that were in negotiation; that were or were not in negotiation.’ Sounds like a sore point,” Arthur reports.

Full article here.

MacDailyNews Take: Good luck, Gorog. You’re gonna need a bunch of it. Still, flapping your lip and constantly trying to denigrate other services doesn’t sound like a valid method of trying to right your sinking ship. Try doing something productive instead. Begging Steve Jobs for iPod WMA support that’ll come the day before Steve fires up Windows Longhorn on his PowerBook G5 sounds pretty last ditch to us. Meow.