Rhapsody marks decade in business as it absorbs Napster

Jon Irwin, Rhapsody president

Ten years ago this weekend, on Dec. 3, 2001, the Rhapsody music service was launched by Listen.com, pioneering the concept of on-demand music.

A lot has changed since then. Rhapsody joined RealNetworks with the Seattle company’s acquisition of Listen.com in 2003, and was spun off as an independent company in 2010. Along the way, Rhapsody has competed against rivals ranging from the iTunes Music Store to Spotify.

But a decade later, Rhapsody is still here, with more than 800,000 subscribers.

Underscoring its status as a survivor, the Seattle-based company this week is officially absorbing another venerable music brand, Napster, which it acquired from retail giant Best Buy, and switching Napster users to the Rhapsody service. Rhapsody says a bundling deal with wireless carrier MetroPCS is also helping to fuel growth.

Jon Irwin, Rhapsody’s president, said in an interview with GeekWire today that he doesn’t see Rhapsody’s growth being impeded by new rivals such as Spotify, which came to the U.S. this year and today announced its new platform for third-party apps.

Rhapsody’s position in 2011 is “stronger than we’ve ever been,” said Irwin.

“I’m very pleased with where we’re headed. I think we’re doing it in a very intelligent and sustainable fashion.”

Irwin said he believes the rise of Spotify actually represents a positive trend for Rhapsody, in a broader sense.

“I think what’s accelerated recently, which is exciting, is a move from this concept of purchasing songs to the fact that I really can access my music from the cloud, which is really what Rhapsody has been doing all along,” he said.

Another major shift: The rise of mobile phones, breaking the iPod’s grasp on the market and opening the door for services such as Rhapsody to offer music on a variety of devices by making apps that work on the major smartphone platforms.

“There’s been a lot of twists and turns since 2001,” Irwin said.

Rhapsody is marking its anniversary on Dec. 7 with — what else? — a concert. Bands including Built to Spill will play at the special event at the Showbox at the Market in Seattle.

  • Guest

    Congratulations to Rhapsody on this incredible landmark! Spotify may have more customers, more music, an app platform, a tie-in with Facebook, a global presence, and a free option, but Rhapsody will always have a special place in our hearts.

  • http://twitter.com/Edsies Edsies

    Ok, so Rhapsody absorbs Napster. What’s next? Who will absorb Rhapsody? Or will Rhapsody just die?

  • http://www.appatic.com Avatar X

    By absorbing Napster they end up with around 1.2 million paying subscribers. I think that considering how both Rdio and MOG now got a play for free version. Rhapsody will have to offer a free ad based version as well. Otherwise competition will prove too hard. As hey have to fight it over with 4 competitors in their model alone as in Spotify, Grooveshark, Rdio and MOG.