A source at online music subscription service Rhapsody.com said the Bay Area company laid off 24 employees today. Calls are out to RealNetworks, Rhapsody's parent company in Seattle, to confirm the information. Any details?
According to MSN Money, RealNetworks just doesn't have the heat right now. Its stock dropped 40 percent to around $6 last year. And its Rhapsody property?
It's a solid music subscription service, and the company has won some nice distribution agreements. But music revenue grew by only a couple million dollars in each quarter of 2006 and 2007, and hit $38 million in Q3.
Rhapsody and RealNetworks sort of competes with Apple, iTunes, and the iPod. That's a tough fight to win.
Friday UPDATE:
Rhapsody PR denies 24 staffers got laid off this week. She said a 12-person "reduction in work" occurred the week of January 17, a month after RealNetworks announced non-music-related layoffs. She said an August merger of digital music subscription services with MTV's Urge created redundancies.
Rhapsody has more than 100 employees in Seattle, San Francisco, and Los Angeles. The company will report its fourth-quarter earnings on February 7.
-David Downs
