The company plans to officially change its name to Napster, taking the brand of the name that was once synonomous with online file-swapping that it purchased almost two years ago. For the last nine months it has operated Napster as a paid digital music download and subscription service, competing with Apple Computer’s iTunes.
Roxio’s decision marks a dramatic and relatively rapid change in the company’s identity and strategy. Once a leading company aimed at helping consumers burn CDs, it has seen that business slowly decline as other software programs such as iTunes have added their own automatic disc-burning capacity.
Sonic Solutions has agreed to buy the software division of Roxio for a total purchase price of $80 million. Under the terms of the transaction, Roxio will receive $70 million in cash and shares of Sonic common stock valued at $10 million.
Sonic believes the acquisition will provide Sonic with a well-recognized set of consumer software brands; access to long-standing distribution channels; strong product marketing expertise; and key relationships with top-tier retail outlets. Once Roxio changes its name to Napster, the company will trade under the ticker