The streaming pioneer Rhapsody has bought Napster International for its campaign to extend its music service subscriptions beyond the US market. Rhapsody, which had already bought Napster’s U.S. division last year, will take on all employees of Napster International, and will continue to use the Napster services Germany and the UK.
Rhapsody was launched in 2001 as an on-demand music service in which users could pay a monthly fee to access the music library. Their catalog was quite limited, but with time the company managed to win contracts with EMI, BMG, Warner, Sony and Universal. Today it is one of the largest premium music service for subscribers in the U.S., with more than 1 million paying subscribers and more than 14 million titles from over 600 genres.
“The acquisition of Napster and its subscriber base in the UK and Germany gives us an ideal entry to the European market,” said the Rhapsody president, Jon Irwin. “Through the benefit of scale, the strength of our editorial programming, and strategic partnerships, we can now bring the Napster service to even more consumers on a variety of platforms.”
Global Expansion in Cloud Music Services
The digital music business saw unprecedented global expansion in 2011. According to labels’ IFPI umbrella, their global music subscribers’ user base has increased by 65 percent to 13.4 million in 2011. With rapid expansion into new markets by services such as iTunes, Spotify, Pandora and Google Music, the major international digital music services are now present in 58 countries.
Spotify has set a benchmark that others are following. One of the strategies the music cloud industry is following is to expand their spaces to new territory with their own new services. MOG, a cloud-music service that previously required all users to subscribe, has launched a Freeplay option, which allows users to earn more play hours if they are actively sharing music content, with an aim to reach to more listeners.
Pandora, the personalized radio service, is now reaching to more and more connected devices and streaming their services to overseas markets as well. The company hired a new CEO in China to expand in Asia. Pandora recently topped the Triton Digital latest Internet audio ranker for December 2011. The company experienced 50 to 100 percent growth in AQH ratings in all of the top radio markets.
Spotify Still Leads Europe’s Subscription Market
Spotify continues to lead the music subscription services in the Europe, while Napster ranks in second place. Although Napster has a strong presence in the German territory and will bring an estimated 350,000 extra customers to Rhapsody, they are still behind newcomer Spotify.
Spotify launched their services in the US last July, and plans to enter the German market very soon. In November, Spotify claimed more than 2.5 million paying subscribers. With 15 million tracks in its library, it is one of the most elegantly designed, independent mobile music subscription services around.
iTunes Global Revenue Reached $6 billion
Apple’s spectacular earnings, released last Tuesday, was a sign of impressive growth for iTunes. Apple’s iTunes sales jumped to $1.7 billion in the quarter ending on Dec. 31, 2011. iTunes recorded an impressive $6 billion in global revenue for the total calendar year of 2011. This includes sales of all content sold in the iTunes Store, from music to videos and apps.
The leader of cloud based music is still ruling the market, and Apple claims its iTunes library had 20 million songs in the most recent quarter.