Today, Best Buy announced its plans to purchase the renowned online music service, Napster, in the fourth quarter of this year. The deal involves Best Buy shoveling out 121 million in US cash to purchase all of Napster's stock, which was only valued at approximately 62 million as of 9/12/2008. The purchase has already been approved by Napster's board of directors and executives.
Best Buy is one of the largest consumer electronics chains in North America and currently runs its own separate online music store. The company hopes that the combined services will be able to dent the enormous market share held by Apple iTunes, which currently controls about 70% of all digital downloads.
No significant personnel changes are expected at Napster and it appears that the music service will continue to operate as its own business unit.
Napster and Best Buy have done business with each other in the past, particularly when Napster paid $10 million in shares to promote its services inside Best Buy stores.
Napster initially debuted as a free online music sharing application and service, which introduced peer to peer file sharing to the masses. The company was eventually sued into oblivion and then resurrected as a legal pay for play music service by Roxio.
