Napster now cheaper than a Soda

Napster, Inc (NASDAQ:NAPS) hit $1.40 a share today and everyday they come closer to falling under $1. Their all new MP3 store couldn't distract investors from their Q4 report and a flat 2008 guidance.  So, do you buy the 16 oz. Coke or a share of Napster?

Yesterday NAPS reported a loss that narrowed nearly 50% during its fiscal fourth quarter as the online music retailer saw higher sales and added subscribers.

Napster Inc. posted a loss of $4.3 million, or 10 cents a share, in the three months ended March 31. That compares with a loss of $8.5 million, or 20 cents, a year earlier. Revenue rose 6% to $30.8 million.

Analysts polled by Thomson Financial expected a loss of 13 cents a share on $30.7 million in revenue.

Napster said it closed the quarter with about 760,000 paid subscribers worldwide, up from 743,000 at the end of December.

The company forecast its first-quarter revenue would range between $30 million and $31 million, with earnings per share to be relatively flat.

NAPS is trading near all-time lows:

Napster Chief Executive Chris Gorog said recent initiatives in mobile music and a shift to selling tracks in the MP3 format -- making Napster's a la carte downloads compatible with iPods and virtually all digital music players -- would help drive future revenue growth.

CNET.com says it's a great song selction but the interface is lame -- Napster MP3 store: great selection, bad interface .

The good part is  every song on Napster's MP3 store is DRM-free, meaning it can be transferred to an unlimited number of computers and devices and will play in just about every music software program known to humankind.  But will this win over the public?

Maybe.

So for now...

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