Rhapsody plans to rebrand as Napster

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The announcement could hardly be more concise, or non-explanatory:

“Napster is coming. No changes to your playlists, favorites, albums, and artists. Same music. Same service. Same price. 100% the music you love. Stay tuned!”

That signals Rhapsody’s un-forewarned announcement that it would consolidate around its subsidiary brand Napster, which it acquired in January, 2012. Napster has been the public-facing brand of the Rhapsody on-demand music service in non-U.S. markets.

Napster, of course, is both famous and infamous as the most celebrated (and reviled) file-sharing network which catalyzed the online music revolution. Apple’s Steve Jobs created iTunes Music Store largely in reaction to Napster, convincing major record labels to dismantle the album into single tracks for purchase, giving consumers a legal and safe way to acquire exactly the music they wanted, unbundled from CD collections. Streaming was a natural evolution the competed both with radio on the lean-back side, and music purchasing on the lean-in side.

We don’t see any inherent advantage to the Napster trademark over Rhapsody, which has represented the venerable subscription-only service which launched to the U.S. market in 2001. But consolidating around one brand eliminated the confusion which has existed with the two-headed Rhapsody/Napster international service.

Rhapsody long pre-dates Spotify, which started in 2008 and rolled into the U.S. in 2011. As such, Rhapsody was the first purely on-demand celestial jukebox for some number of early adopters. The service has never offered a freemium, ad-supported complement to its subscriptions.

It is easy to speculate that lack of a free on-ramp to the $10/month music subscription slowed the company’s audience growth. In the U.S., public imagination was not caught up in on-demand music service until Spotify arrived with its hybrid service, where the free part was semi-interactive and acted as a funnel to the paid tier. At the end of last year, Rhapsody claimed 3.5-million subscribers. Spotify has nearly ten times that number … but it’s worth noting that Apple Music has amassed 15-million subs as it approaches its one-year birthday, also without a freemium plan.

This is a time of change and fresh thinking for Rhapsody. Mike Davis, ex-UMG and startup executive, was hired in April as new Rhapsody CEO. He has kept the company in the news, publicizing audience metrics and instituting a round of layoffs to streamline the organization.

Brad Hill