The rise of Napster’s Market Share In June, Napster (NAPS) quietly unveiled it’s own brand of MP3 player. The Napster brand MP3 players are currently available through a promotion of it’s 14.95 a month ‘Napster to Go’ subscription, for $50.00 with a 1 year subscription. The players feature an FM tuner, a color LCD screen, six equalizer settings, and support for MP3 and WMA audio files and JPEG photo and MPEG 4 video files. In comparison, the Apple (AAPL) Ipod is currently running $299.00. And don’t get me started on the price comparison to download music. Napster offers unlimited music downloads for their $14.95 subscription price. Apple is charging .99 a song. Don’t get me wrong, Apple has a strong brand name and will always be an archrival to Napster. But, Napster has strong brand recognition as well and offers far more value. Now let’s talk about the Napster stock. In May, Napster released Q4 earnings that narrowed its losses and topped Analyst’s estimates. For the quarter, they lost 4.4 million, or 17 cents a share, compared with a loss of 24.3 million, or 60 cents a share in the same period of 2004. Analysts had predicted a loss of 35 cents a share for Q4 2005, which Napster handily beat. I would expect to see Napster begin to turn a profit as early as December of this year and if they just can’t turn profitable on there own, they could be an acquisition target. Their core subscriber base has grown by leaps and bounds, currently sitting at approximately 600,000 subscribers. I don’t see much downside below the current price of $3.13. I can see Napster going as high as 7 by the end of 2006 or mid 2007. Article written by: Phil McCallister Article posted on: August 8th, 2006