As Wall Street takes a tumble with what's quickly being branded "Black Monday," Best Buy is announcing a new and slightly out-of-left-field purchase: Napster.
The electronics chain is snatching up the once-thriving music service for $121 million ($2.65 per share), it announced this morning. The move comes just weeks after word of internal turmoil and hints of "strategic alternatives" in the works.
Under the new deal, Best Buy will get all of Napster's subscribers -- said to somehow be in the range of 700,000 -- along with its platform and mobile capabilities. Napster's senior management will move into new roles within Best Buy. The 140 employees at Napster's LA headquarters are expected to keep their jobs and locations, at least for the time being.
Can the move save the struggling download service, which hasn't seen its heyday since certain events transpired back in the early part of the century? Let's be honest: Probably not. It'll no doubt grow from its current stagnant state -- surely the soon-to-come heavy in-store push and packaged deals will help -- but all the vending machines in the world won't let it hold a torch next to the music monster that is iTunes. As Paid Content points out, both Best Buy and Circuit City have played with the idea of digital distribution in the past with little ending effect. The sale can only help Napster in the long run, but one wonders how much it'll ultimately help Best Buy.
The deal is expected to be completed before the end of the year. Wonder what Shawn Fanning's thinking right now...