Thursday, January 26, 2012

Rhapsody buys European Napster rump

Gigaom seems convinced that Rhapsody's purchase of the UK and German parts of Napster will allow Rhapsody to take on Spotify in Europe.

Perhaps. But, given that I don't think many people in the UK had even realised there was an on-going European Napster after the closure of the American service suggests that it's not really going to make a difference in the UK.

Napster is doing a bit better in Germany - it holds 70% of the steaming market, so it's possible that's where Rhapsody sees the value with the UK service thrown in for free.

Napster doesn't face competition from Spotify in Germany yet and its position was boosted earlier this week when Grooveshark quit the country, saying that the higher royalty rates made it impossible to run a business. (The German royalties organisation, GEMA, counters that Grooveshark had a figure of zero in mind.)