“Napster-owner Roxio more than doubled its net losses year-on-year thanks mainly to increased spending on the relaunch of the music download service, which went live in October,” Susie Harwood reports for netimperative.com. “The company posted a net loss of $25.6m for the three months to December, up from a loss of $9.2m for the same period a year earlier. And, despite exceeding expectations for its core software sales business, third quarter revenue fell to $18.8m from $25.4m.”
“Napster had revenue of $3.6m and a pre-tax loss of $15.1m, while Roxio’s digital media software division had revenue of $15.2m and a pre-tax loss of $10.1m, including restructuring charges of $4.4m. Roxio said in December that it expects to significantly reduce Napster-related spending as its moves away from the launch quarter,” Harwood reports. “In line with this planned cost cutting, the company said last week that it would consolidate Roxio and Napster’s corporate functions and senior management teams into Napster’s offices in Los Angeles.”
Full article here.
MacDailyNews Take: Napster’s revenue was just $3.6 million since Napster 2.0’s beta launch back on October 9th? Ouch.
Related MacDailyNews articles:
Napster Exec: warns ‘stay-off the Apple platform’ to MIDEM international music market delegates – January 26, 2004
They’ll be lucky if they aren’t belly up before year’s end…only a blind bat didn’t see this one coming from a mile away.
This is too bad for Roxio. Toast is the best thing they ever did (Nero is preferred over their Easy CD Creator in the Windows world). Now they’re trying to screw over the Mac community with their WMA garbage. Serves them right.
Bye Napster.
I used to love you. Now I hope you die.
I’m really surprised.
Don’t get my wrong I am 10000% Apple/iTunes lover, but I thought that they would have done really alott better with the windozzz market..
Oh well, this should be a red flag to the million other companies launching similar serviecs in 2004, coke-cola online music i’m talking to you!
Was there $3.6 Million profit from 10/9/03 to 12/31/03 or up until the present?
“This is too bad for Roxio. Toast is the best thing they ever did (Nero is preferred over their Easy CD Creator in the Windows world). Now they’re trying to screw over the Mac community with their WMA garbage. Serves them right.”
You know, Apple really needs to buy Toast from them. Yeah, I know, 3rd party developers blah blah blah, but I can’t think of another thing Roxio is good for, and it’s not like Toast has a lot of competition.
I think it was 3.6 million revenue, not profit.
This next quarter is their fourth, which requires an audit and the accounting firm to declare it a going concern or not. They’ve already spent the $22 million they just raised and cash is falling precipitously. Their stock is getting lower which means they will not be able to go to the public markets for more cash. Their Software business is dying fast as their DVD software is considered inferior to the competitors who are taking one account after another away from them.
Apple is out marketing them 20:1 plus now Pepsi and HP have joined in among others. Hmmm, it doesn’t look good.
Maybe Apple can help them out by taking Toast off of their hands for a price. If not, Apple can add features to iLife and make “toast” out of Toast.
Forget about those “format wars.” The better service wins hands down. As long as Apple continues to rip, mix and burn, these other companies don’t stand a chance.
Roxio is toast.
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Oh. I like good news on mondays
“I used to love her, but I had to kill her…but I can still hear her complain!”
“I used to love her, but I had to kill her…but I can still hear her complain!”
Got mixed feelings about things. I like “Toast”. I dont think Apple would buy “Toast” but, someone else might.
It’s going to bleed to death and others will notice this and maybe not get into the music business at all and instead will let Apple/iTunes/iPod lead the way for the rest of history since their model seems to work best. Take notice people! Duh!
That should give pause to some colleges thinking about forking up a nice chunk of IT change to give Napster-Lite service to their students. Will they even be there next fall to deliver?
Finally, some hard numbers for comparison. Where’s BuyMusic.com’s numbers? Anyone got anything to report? Or have they already quietly slipped away into the night…?
$3.6mil in million in revenue doesn’t tell us the whole picture. I want to know how much of the revenue was from subscription servies vs. download sales?
I have been waiting to report on this, and this seems as good a place as any. I am a second-class citizen (Canada) which does not have access to iTMS yet. However, here in Canada, we do have PureTracks (http://www.puretracks.com). If you try this on your Mac with any of the normal complement of browsers (even doctored up to present as IE), you get locked out of the system.
Score 1 for Puretracks. No Mac subscribers in a country with no iTMS.
…So…I tried it at work, which as a reasonably sophisticated firewall system (Windows 2K/viruses/malware et al. donca know?), and the 30 second demo feature does not work!!! It even says that if you have a firewall, you are probably out of luck!!!
…So…I stoked up iTunes, and the demos work fine.
I report all this to emphasize that these ‘competitors’ DON’T GET IT. iTMS will CRUSH them when they go international.
Mike
Ray said “Was there $3.6 Million profit from 10/9/03 to 12/31/03 or up until the present?”
Hey Ray,
$3.6 Million was their revinue not their profit. The bottom line on this is that they had $3.6 Million in income while spending $15.1 Million getting the service up and running. To top it off that does not take into account the 66% of the income from downloaded music which goes to the music companies. Who knows what deal they have for the streaming music service but it can’t possibly be good enough to save their profit margin.