EMusic.com Inc., which offers songs that can be downloaded from the Internet, debuted on the Nasdaq stock system Wednesday, becoming the first such ventures to list as the business of selling music online accelerates.
EMusic.com is the new name of GoodNoise Corp., whose stock price previously was listed on the Nasdaq bulletin board, a system for listing prices of public-company stocks that do not qualify for the Nasdaq system.
Although shares in the Redwood City, Calif.-based company shed $3.25 to $25.94 in its first day of trading, analysts said they expected EMusic.com’s offering to make it a strong player in Internet music.
“This will just fuel the interest and focus on online music, which has clearly picked up over the past several weeks,” said Geoffrey Sands of research firm Booz-Allen & Partners.
Wall Street investment firm Warburg Dillon Read was bullish on the firm, awarding the stock a “buy” rating and a price target of $39 per share.
“Unlike other companies which provide download technologies, EMusic.com is focusing on acquiring (music) content, which we believe will be the ultimate determinant of success in this business,” Warburg stated.
Separately Wednesday, MP3.com saw a potential legal headache vanish after it settled a copyright dispute with PlayMedia Systems Inc., a software company that had sued popular MP3.com for distributing an MP3 playback program that PlayMedia alleged contained proprietary code.
PlayMedia, which had also named Nullsoft, maker of the disputed WinAmp MP3 player, said it settled litigation with both companies and had entered a business relationship with MP3.com. It gave no details.