After Rhapsody bought ex-music piracy site Napster and strangely rebranded itself with their name and logo the brand is showing it’s first profit for years.
Rhapsody was one of the OG music services starting all the way back in 2001 but as newcomers came along and dominated the service like Spotify and Apple Music. After Napster’s music piracy ties caught up to them Rhapsody eventually bought them out in 2011. 5 years later, for some unknown reason, Rhapsody decided to take the Napster brand and replace it with their own – and apparently it worked out for them.
Rhapsody International, Napster’s operator which kept it’s own name, just reported record revenues of over $54 million for the third quarter of 2016. This resulted in a $1.6 million profit and marks their first profit since the end of 2013 and their first significant profit in even longer.
The profit suggests that the Napster branding has worked for Rhapsody and caused an uptake in users, despite (or perhaps due to) it’s history of music piracy. It also suggests that struggling Rhapsody may recover and once again hold a powerful position in the music streaming market.
Although the success could be seemingly linked to their rebranding the company did also have to make some cutbacks and layoffs which would have resulted in lower spending. Mike Davis, who became Rhapsody CEO in April, said to Billboard in June: “As part of our plan to better position Rhapsody/ Napster for long-term profitability and accelerated growth in a competitive global market, we have a new, streamlined structure for the company that unfortunately impacts a number of positions across our global offices.”
Rhapsody were however reporting increased success last year before the Napster rebrand, with Davis claiming 35% growth last year and finishing with 3.5 million users. It’s still a long way off of Apple Music’s last reported 17 million subscribers and Spotify’s 40 million subscribers, with over 100 million total users, but this could signify the beginning of a comeback for both Napster and Rhapsody in one.