Napster.com Could Bring In $50 Million Annual Ad Rev: "Too soon for meaningful results but analysts are applauding subscription services Napster and Rhapsody for adding advertising revenue to the mix; so are labels and publishers, who get a cut. Piper Jaffray analyst Gene Munster thinks napster.com alone could bring in $50 million annually from advertising, according to Billboard. The lure of that advertising revenue changed Napster’s plans to rely on subscription alone; as CEO Chris Gorog explains, ‘… This was an effective piece of real estate we weren’t using to any scale.’
In addition to the ad revenue, which varies with usage, labels and publishers stand to gain from users’ repeated, but limited, exposure to their music. EMI EVP Adam Klein: ‘Consumers who spend more time experimenting with music end up spending more money buying music.’
(Via paidContent.org.)