Another Tweak In the Formula: Napster Spins $5 Monthly Charge

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Best Buy owns Napster, so now what?

Subscription remains a difficult play, especially alongside free streaming concepts like Imeem, Spotify, and MySpace Music.  So what does an earlier-generation, paid subscription concept do?  Well, Napster is now offering on-demand access to its catalog for $5 per month, a deal that also includes five DRM-free downloads.

Best Buy purchased Napster at a fairly good valuation, and gained access to a music-targeted database in the process.  Easy wins involve in-store sales of pre-paid cards and consumer electronics tie-ins, though the more difficult challenge involves subscriber growth.  Napster, alongside competitor Rhapsody, pioneered the first wave of paid subscription, but the concept remains a niche.

Whether this $5-a-month plan will help to solve that problem remains unclear, though Napster now has iPod compatibility.  A close-to-zero price tag also helps, as does a direct marketing channel to Best Buy shoppers.  But even a smashing success will have its downsides – after all, this plan is dangerously cheap, opening questions about whether stakeholders will truly benefit.