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Best Buy to Acquire Napster for $121 Million

  • Posted: Saturday, September 20, 2008
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  • Author: pradhana
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  • Filed under: Merger-Acquisition

By Jason Ankeny

Electronics retail giant Best Buy announced a definitive merger agreement to acquire digital music service provider Napster for $121 million. Per terms of the deal, Best Buy will scoop up Napster's 700,000 digital entertainment subscribers, its web-based customer service platform and mobile capabilities--Napster CEO Chris Gorog and other senior management suits will remain at the helm post-acquisition.

Best Buy said it will employ Napster's digital services to reach new customers across an increasing array of devices, with an emphasis on capturing recurring revenue via the mobile platform.Napster's mobile music services include Napster Mobile, an over-the-air initiative launched by AT&T in fall 2007, as well as services in conjunction with operators spanning from O2 UK to NTT DoCoMo.

In May, Napster also launched a new DRM-free MP3 download store promising the industry's largest major-label MP3 catalog as well as compatibility with any portable media player or music phone, including Apple's iPhone and iPod. As for Best Buy, its increasing mobile profile includes a fast-growing line of wireless products as well as dedicated handset departments throughout in its U.S. stores. Best Buy now also sells Apple's iPhone 3G. [FierceMobileContent]

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