History
In 1999, Tim Bratton, J.P. Lester, Sylvain Rebaud, Alexandre Brouaux, Nick Sincaglia and Dave Lampton were working on a new streaming audio engine. This engine was commercially deployed in the TuneTo.com customized radio service, and was also used in their "celestial jukebox" prototype, called Aladdin.
In April 2001, TuneTo.com was acquired by Listen.com, a startup founded in San Francisco by author and entrepreneur Rob Reid, that had built a large online music directory. Aladdin was transformed into the Rhapsody music service during the summer and fall of 2001 and was launched on December 3, 2001.
Rhapsody was the first streaming on-demand music subscription service to offer unlimited access to a large library of digital music for a flat monthly fee, a concept advocated by business theories such as the Open Music Model. At launch, Rhapsody's library was formed of content mostly from Naxos Records and several independent labels. Over the next several months of 2002, they were able to secure licenses from EMI, BMG, Warner Bros. Records, and Sony to add their music to the service. In July 2002, Rhapsody managed to add Universal Records to their catalog, thus getting the last of the five major record labels of the time.
RealNetworks announced plans to acquire Listen.com on April 21, 2003, one week before the launch of the iTunes Music Store on April 28, 2003. The transaction closed on August 3, 2003. The Rhapsody service was briefly known as RealRhapsody shortly after the acquisition, but has since shortened back to "Rhapsody".
In late 2007, MOG partnered with Rhapsody to allow Rhapsody subscribers to access all of Rhapsody's content through MOG.
In February 2010, Rhapsody's owners announced their intention to restructure the company into a fully independent corporation. Recent problems with the online music subscription service prompted the CEO to make "crucial decisions and think some things through". During this period, dropping the subscription service was considered, but he felt it wasn't the right decision at the time. Instead, the whole Rhapsody team thought of ways to revamp the struggling company and in turn dropped RealNetworks as parent of the company. This was a very risky decision, as the company needed the support, but gained the support of MTV Networks and Viacom, and other independent companies. Since independence, Rhapsody has started the revamping process with a new logo and subscription price changes.
As of January 2011, Rhapsody president Jon Irwin told Reuters the on-demand subscription music service had more than 750,000 subscribers, having added more than 100,000 since becoming an independent company. At that date Rhapsody had a catalog of 11,000,000 songs.
In September 2011, Rhapsody announced that from October 2011 they would no longer re-license DRMed music bought before July 2008.
On October 3, 2011, Rhapsody announced plans to acquire Napster with the deal to be completed by November
Read more about this topic: Rhapsody (online Music Service)
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