It’s an Ad World

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Napster is back in full effect, kind of. A recent article in USA Today discussed its new ad supported model. Now visitors can come to Napster and listen to music absolutely free. Oh, but you can only listen to the song five times then you can buy it for under a dollar or sign up for a monthly subscription for $9.95. And if you want to have access to transfer the song to your portable device, that version costs $14.95, but you wont be able to transfer it to your iPod because the service is only compatible with specific digital music devices and your iPod isn’t one of them.

So, as you can see the “new” Napster isn’t completely free, but kind of. I don’t think we will ever be able to go back to the early days of totally free Napster. I remember sitting in my dorm room, probably very much like the one Napster was originally created in, downloading songs like a crazy woman. It was great and it was all free.

With Napster’s new ad-supported model, advertisers will be able to reach all of its 600,000 subscribers. Over the last couple years Napster had actually lost more than $73 million, but with online advertising hitting record highs and continued expectations for growth, Napster CEO, Chris Gorog feels strongly the online ads can pay off for Napster.

But don’t go thinking all the ad dollars are going straight to Napster. In order to get approval for ad-supported music, the record labels had to sign on. And so they did, but not without a piece of the ad revenue.

I wonder who is influencing whom. It was also reported last week in Marketing Vox that iTunes will also be accepting advertisers. They have only designated a small area in the lower-left corner of the iTunes library for these new paid ads. But they are still charging full price for their tunes.

Ad supported music models such as Napster and iTunes offer an incredible opportunity for marketers to place their ads within specific content, content that consumers are actually seeking. So yet another online advertising door opens…and for those of us who remember free online music downloads, another door sadly slams shut. Such is life.

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