Napster 2.0 posts US$15 million relaunch loss

“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 “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


  1. 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 ( 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.


  2. 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.

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