Napster Pre-Paid Cards

G4Outcast writes "According to this CNN Money article, Napster will be offering pre-paid cards costing $14.85 at several retail locations. I guess the iTunes gift certificate and allowance idea is catching on."

Comments

coincedence?

[Suppafly]

The Napster Card will cost $14.85, entitling the user to 15 downloads -- in line with prices of newer rivals -- and will be available at 14,000 locations in mid-November at such major retail chains as Best Buy (BBY: down $1.17 to $53.64, Research, Estimates), CompUSA, Safeway (SWY: down $0.35 to $21.16, Research, Estimates), Rite Aid (RAD: down $0.06 to $5.68, Research, Estimates) and Duane Reade (DRD: down $0.30 to $13.50, Research, Estimates).

It's kind of odd how the stock prices are down for every company that is planning on selling these pre-paid napster cards.

Here's the problem with these paid services.

[ahfoo]

I cranked up Kazaa yesterday to see what the numbers looked like. I saw 4.1 million.
Well, back when I used to check in more frequently a few months ago I rarely saw it that high. I tried some searches and it seems it's all more or less back where it was.
So, this shock and awe thing seems like a memory already. I mean what even happened to the first batch. As far as I can the majority settled for a few grand and then a whole bunch decided to fight. Well, where's the shock and awe in that? Obviously people are going to wait to see what happens in the courts. But in the mean time they're going to forget about it.
It would have been one thing if it started as a hundred suits followed by a thousand and then by ten thousand. That would have done something. But this 200 every two months is not all that shocking or awe worthy.
But of course that would also have provoked even more congressional attention. So either way they were fucked which is what evrybody said from the beginning and now it still seems to be true.

what the...

[slim hades]

"The company is aiming the card at teen-agers without credit cards and parents who want to give the gift of legal music downloads. " and then the RI*A can sue the parents.... brilliant... (why does "give the gift of legal music downloads" sound like a Public Service Announcement? I wonder what kids are forced to watch in school nowadays.)

Oh, I don't know

[sbma44]

I don't know about Duane Reid stores, but all those others already sell prepaid cards of one form or another, so they presumably already have systems for distribution of these things. The cards probably won't even be plastic, just a fold-out piece of paper with a one-time use code printed on them. My guess is that production costs are at most a few cents per card.

I wouldn't be surprised if this is actually a more efficient way of selling their merchandise, since they don't have to give a cut of every transaction to the credit card companies.

Requirements

[big_groo]

System Requirements PC only, Windows XP/2000, Microsoft Internet Explorer 5.01 or higher, Windows Media Player 7.1 or higher, Internet connectivity

And check this out from the Privacy Policy:

AUTOMATIC DATA COLLECTION

Napster Client. After you register for the Napster service, you will be prompted to download our Napster Client software application. In order to make sure the Napster Client is functioning at its best, from time to time we may send the Napster Client automatic fixes, support files, etc. Napster employs software that is used to protect the copyrights associated with the tracks you listen to or obtain. In order to make sure that artists and copyright owners receive applicable royalties, this software identifies and counts the songs you have obtained and/or accessed. At the aggregate level (i.e., not tied to the personally identifying information of any user), we use this data to report and pay royalties, for internal analysis and we share this data with certain Partners for their own analysis. We do not share your personally identifying usage data with any third parties. We may use your personally identifying usage data for a variety of service-related purposes.

From time to time, the security on the Napster Client software may be upgraded by our supplier, which is currently Microsoft. Microsoft advises us that for security upgrades, your player will connect to an Internet site operated by Microsoft and will be sent a security file, along with a unique identifier, which does not contain any personal information about you and is not used to personally identify you or track your activities. Microsoft uses this information to prevent security breaches that could affect you. For more information, please feel free to read Microsoft's privacy policy at http://www.microsoft.com/Windows/windowsmedia/soft ware/v7/privacy.asp#_Security_Upgrade_(Individuali zation).

Further, when you access the service through a Partner and download the Napster Client, we will add certain of your registration information (such as your member name and, if applicable, the Partner or promotion through which you registered) to the registry settings on your computer's hard drive, so that we can recognize which of our Partners or other sign-in pages to send to you when you log on to the service.

Microsoft?? No wonder they were less than enthusiastic about iTunes for Windows.

Settling

[reptilicus]

Hmm, thinking about it, if the RIAA is willing to settle for $2000, as they seem to be, then if you download 100-150 albums (at $15-20 each), you come out ahead of the deal, even if you are one of the tiny minority they actually threaten to sue.

Re:Where's Napster's Suger?

[Johnny Mnemonic]

That's what the parent post said. So the question remains: how is Napster et al going to be profitable, since they don't have the margin of an "iPod alike" to take to the bank? Especially since they presumably have to pay MSFT for their encoding technology, also. And, they have to compete with every other WMA enabled $.99 download music site.

Well, it could be that a) MSFT is giving a discount on their encoding tech, to get it established in the marketplace; but wait until it gets established. Then MSFT will triple the prices, and what are you going to do? They've done this before. Or, b) it could be that Napster gets some kick from the portable music players. No question that digitized music helps sells players for said music, so maybe the top 5 manufacturers all pay Napster something back. Finally, c) it could be that Apple just isn't managing the iTMS revenues very well, so a more efficient company is able to actually make money on the music alone. I don't know what Apple's expenses are well enough to know if the cost of the iTMS is reducible or not; for instance, is it bandwidth cost? Server cost? Dunno.

Re:Interesting Marketing

[microcars]

and how many of these pre-paid Cards will be purchased as GIFTS that never get redeemed?

they either get given to Apple users (who can't use them), or the card gets lost or accidently thrown away.

and if nothing else it builds Brand Awareness.

I can see these being printed up and used as corporate schwag, given away at trade shows to be associated with any number of other products.
A one-song card could be stuck in a Cereal Box.