Napster is Laughable Competition

If you watched the Super Bowl this year you probably saw the Napster commercial. The ad was simple in its messaging: “Do the Math. How much will it cost to fill up your player? iTunes+iPod= $10,000. Napster To Go+compatible MP3 player=$15 per month.” Should Apple be scared Napster will take customers away from iTunes Music Store? No. In fact this Napster offering shouldn’t even bring Jobs and co. a shiver.

People say iPods are the gateway drug to Apple computers. Using that analogy, it can be argued that Napster was the gateway drug to the iPod. After all, most people didn’t know the difference between MP3 and AIFF until they realized they could get their favorite music for free using Napster. And with that new found knowledge of audio formats, the need to hear it on the go became widespread. So as people started to grow their music collections, associating your computer with their music became a standard. Thus the rise of the iPod. So, (rightly so) the RIAA got upset and in effect shut down the old iteration of Napster.

Now that we got the short (and grossly generalized) history of file sharing out of the way, let’s talk about the new Napster. Even though the old Napster went the way of the dinosaur other networks formed like Limewire, Kazaa, and Bit Torrent. As much as the MPAA is getting more press these days in combating illegal movie downloads, people are still downloading music illegally.

Unfortunately for the music business, this will never stop as mega file sharers reside in countries outside the RIAA’s jurisdiction. The fact that anyone at any time can still find whatever song they want and download it for free is a major blow to the music industry and puts legal download sites at an immediate disadvantage. That was the case until Apple made it cool and seemingly affordable to do it legitimately with the iTunes Music Store. Napster probably thought it would use the name recognition to springboard into the market as a major threat to the ITMS. But (at least for me) the fact that Napster, (a name previously synonymous with FREE), is now charging for music is a huge disconnect to me. When I first saw the commercial, despite knowing the history of Napster, I was taken aback seeing the logo again next to a dollar sign. In my opinion, they would have been better off just coming up with a new name altogether.

Now for the pricing structure of this new, legit Napster. $15 a month buys you unlimited downloads from 1 million tracks consisting of 90 thousand albums and 60 thousand artists. Sounds great right? You might be thinking,“Gee, I can just subscribe, download everything in one month, burn them all to CD and then cancel my membership”. Not so fast. First off, if you are running OSX, you’re out of luck. Napster is only available for Windows XP/2000 or higher. Secondly, the commercial is misleading. The $15 a month does not buy you cd burning privileges. It buys you downloading and listening privileges. If you want to buy the music outright, it will cost you “as low as” $.80 a track when purchasing multiple tracks at a time in addition to the $14.95 monthly fee. I don’t know about you but if I pay one cent for any music, I want to be able to use it anyway I like. That includes burning it to a cd. Using price as the point of differentiation between Napster and ITMS is a gross misrepresentation.

Don’t want to pay the monthly fee? Sure thing. With Napster Light you can just download music to burn to cd. Price per track? Yup. You guessed it: $.99. Price aside, another problem with Napster is its branding of its products. There is Napster. There is Napster To Go. There’s also Napster Light. Sounds like I’m reading the labels at a liquor store. Napster’s desire to brand individual plans will create confusion with customers and frankly I don’t think people will be willing to try and figure it out. With ITMS, there’s no monthly fee. No program or plan to sign up for. You find a song, preview it, and if you like it, you buy it. It seems that in an attempt to differentiate itself from iTunes, they made things more confusing.

So what’s next for Napster? My prediction is not much. After all, they can’t compete product-wise with Apple and they can’t compete cost-wise with P2P. I guess they will just have to deal with profitability on a much smaller scale. A small scale that only includes the soon to be less than 10% of MP3 player users who don’t own an iPod. I guess someone has to service those people.