AAPL Stock: 117.14 ( -1.17 )

Printed from

Rhapsody drops to $10 per month, gets Universal stake

updated 10:05 am EDT, Tue April 6, 2010

Rhapsody cuts price to stay relevant

Rhapsody today slashed the price of a subscription from $15 per month to $10. The immediate cut still provides the same features, which includes unlimited music downloads as well as streaming and in some cases local caching. Permanent MP3 downloads are still an option and usually cost $10 per album with songs ranging between 79 cents and $1.29.

The price drop is the first clear action since Real spun off Rhapsody as a separate company and should potentially help stem losses to other unlimited music services. Most of the US-based equivalents, like Microsoft's Zune Pass, still charge $15 per month, albeit in some cases with perks such as 10 free MP3 tracks each period. Rhapsody's lack of distinction has led it to lose subscribers to where it now has just 675,000 active users.

The company has also confirmed that Universal Music Group has paid for a small, five percent stake in the business. The move leaves Real and Viacom with equal stakes and should give Rhapsody a needed cash infusion to offset recent losses. With the cut and expected subscriber increases, Rhapsody expects to be profitable again by the end of the year.

Both the new pricing and the Universal deal reflect a race to get Rhapsody back on track before Spotify arrives in summer and provides both a competitive price for streaming as well as a free, ad-supported option. It remains smaller due to its Europe-only limitations but is expected to grow rapidly once it reaches the US. Unlike Rhapsody, Spotify has investment from all four major music labels and should get much stronger promotion as a result.

by MacNN Staff



  1. facebook_Carlos

    Via Facebook

    Joined: Apr 2010


    comment title

    your comment

Login Here

Not a member of the MacNN forums? Register now for free.


Network Headlines

Follow us on Facebook


Most Popular


Recent Reviews

Ultimate Ears Megaboom Bluetooth Speaker

Ultimate Ears (now owned by Logitech) has found great success in the marketplace with its "Boom" series of Bluetooth speakers, a mod ...

Kinivo URBN Premium Bluetooth Headphones

We love music, and we're willing to bet that you do, too. If you're like us, you probably spend a good portion of your time wearing ...

Jamstik+ MIDI Controller

For a long time the MIDI world has been dominated by keyboard-inspired controllers. Times are changing however, and we are slowly star ...


Most Commented