On Thursday, Private Media Group Inc. PRVT.O , a publicly traded adult entertainment site based in Spain said it has made an offer to buy some assets of the defunct song-swapping site for stock valued at about $2.4 million.
In a statement issued from Barcelona, Private Media said that it had offered to acquire the Napster trademark and napster.com Internet address for one million shares of Private Media common stock.
Private Media shares closed down 11 cents at $2.41 on Nasdaq on Thursday.
A representative for Napster was not immediately available for comment. The service recently closed its doors and fired all but a few of its remaining staffers as it prepared to liquidate remaining assets.
The revolutionary Internet song-swap service was hailed by millions of music fans but damned by the powerful recording industry officially shut down earlier this month after a U.S. bankruptcy court blocked its final sale to German media giant Bertelsmann AG BTGGga.D .
Private Media Chief Executive Charles Prast said in a statement that copyright infringement was a major issue in the online adult entertainment industry as well as for the mainstream music and movie industry.
“Acquiring Napster is our way of entering the peer-to-peer marketplace for adult content in a closed environment,” Prast told Reuters.
Private Media said it plans to use the Napster trademark to offer millions of adults worldwide the ability to swap adult-oriented content for free and to also gain access to “top-quality” content at a reasonable price. Private Media claims to own the largest library of adult-oriented content in the world, with global copyrights to the content.
Prast said his company is not interested in the Napster technology, but was talking with several other companies to develop a peer-to-peer platform.
“Clearly, this is an initial offer, and we need to speak to our counsel as to how best to approach the bankruptcy court,” Prast said.
He said that Napster’s lawyers were made aware of his company’s offer but that he and his company had not had any direct communication with Napster’s management.
“Along with Hollywood and the recording industry, we have become increasingly concerned about the level of copyright infringement inherent in the free peer-to-peer file swapping services,” Prast said.
Napster, which at the height of its popularity commanded a following of some 60 million users, fell afoul of the powerful recording industry, which targeted it as a dangerous new vehicle for copyright violation.
Experts said Kazaa and other popular peer-to-peer services, which have emerged in Napster’s wake, are popular channels through which pornography is now traded without authorization.
Napster’s web site went black last Tuesday, with a mournful tribute “Napster Was Here” in the wake of swift demise following a decision by a Delaware court to block Bertelsmann’s $9 million offer to buy the company’s assets. Record labels and songwriters opposed the deal, arguing it was not a fair price.
Faced with no financing, no revenues and no other buyers, Napster’s Chief Executive Konrad Hilbers said the company would now switch reorganization efforts to a Chapter 7 liquidation.
Hilbers, and Napster’s founder Shawn Fanning, were among those who lost their jobs.
Mike McGuire, analyst with GartnerG2, said the Private Media offer, if it stands, might be hard for Napster to turn down.
“If its legitimate, it’s a whole lot better then what they have right now, which is a sea of red ink. I’m not sure you can argue personal pride against a bid,” he said.