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Napster On The Auction Block

In the latest sign of the mounting pressure facing music download sites, Napster owner Roxio is officially looking for a sale. The company hired UBS Investment Bank to explore its options, which could include a strategic buyer or a major strategic partner. Napster lags well behind Apple's iTunes, which has been bolstered by the widespread popularity of its iTunes media player and RealNetworks' Rhapsody music service. Microsoft is now entering the game with its own music player, called Zune, along with a download service that will debut later this year. Michael Gartenberg, an analyst with JupiterResearch, points out that Napster appeared poised for a buyout earlier this year. He says there are no fewer than five incompatible music services, all grabbing for their share of a market that still pales in comparison to the widespread piracy on the Web. There just isn't room for all these closed services, Gartenberg notes, and it just doesn't look like the Recording Industry Association of America can stamp out music piracy altogether. Possible buyers for Napster include Creative, which makes a music player of its own, wireless phone manufacturer Motorola, which might consider syncing its wireless phone business with an online music service, or Samsung, the South Korean electronics giant that sells both phones and digital music players. Samsung announced its intention to enter the online music market on Sept. 1, with a service aimed at markets in Britain, Germany, and France.

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