Originally posted on 8/15/13 by Digital Music News
Welcome to the twisted economics of music streaming. Because if Rhapsody — a paid-only service — can't turn a profit, then who in the streaming space can?
The longest-running music subscription service now has one million paying subscribers (at last count), and has largely refused to support millions of non-paying, ad-supported users (unlike some rivals). Basically, if you're not paying for it, Rhapsody isn't that interested in you. Rhapsody has also steered clear of massive investment rounds, preferring a smaller, sturdier approach that focuses on paying music fans. Even if that means far lower 'active user' counts, flashy Facebook integrations, and other Spotify-like mega-expansions. Yet despite all that premium prudence, Rhapsody's financial balance sheet, revealed this week, shows $9.2 million in net losses for the first half of 2013 alone. That's far worse than the same point last year, with GeekWire pointing to shifts away from advertising (on rhapsody.com) and MP3 downloads. But this gets way worse. The financial details were disclosed in a filing by RealNetworks, which still holds a 45 percent share in the company. And in that filing (here), RealNetworks noted that Rhapsody has actually been generating losses since its inception more than ten years ago. "On March 31, 2010, we completed the restructuring of our digital audio music service joint venture, Rhapsody America LLC," the filing continues. "Rhapsody has generated accounting losses since its inception and we have recognized losses on our investment in Rhapsody since the restructuring."
4 Comments
Amilcar 'PRO' Welton
8/19/2013 12:08:50 am
$9.2 million in net losses for the first half of 2013!
Sandy
8/22/2013 01:59:07 am
I predict that a competitor will purchase Rhapsody, take the good components, then leave the rest of the model to die. They needed to install a quick moving executive team about 2 years ago.
TJ
8/22/2013 01:59:51 am
I agree 100%!
Indie Exec
8/22/2013 02:04:38 am
The question is would a potential buyer be from the music industry technology side or a standard major label corporation like Universal? Leave a Reply. |
MISSION The purpose of the CREATE.Digital Blog is to provide an interactive knowledgebase & promotional platform focused on quality not quantity. AUTHORS
Contributors to the CREATE.Digital Music Blog will include internal staff & a variety of professional, qualified, opinionated, diverse, & experienced guests. ARCHIVES
June 2022
CATEGORIES
All
DISCLAIMERPLEASE READ
All the contents of the CREATE.Digital Blog, except for comments, constitute personal opinions. Blog content may contain inaccuracies or errors, and discretion should be exercised in the use information obtained from the blog. Blog content is provided for informational purposes only and is not a substitute for advice from qualified professionals. All blog content comes without warranties, representations, or guarantees of any kind. You agree that any use you make of blog content is at your own risk. You also agree that CREATE.Digital Music is not responsible for any losses resulting from your reliance on any blog content. We also reserve the right to revise any and all content on the blog at any time. If you report offensive or inappropriate comments to CREATE.Digital Music, We will generally investigate and remove comments if required. All blog content, including all information, text, graphics, photos, images, logos, and site design, is our intellectual property, and is protected by copyright and applicable intellectual property law. |
RSS Feed
© 2022 CREATE.Digital Music. All Rights Reserved.