Napster is nearing "a substantial round of layoffs," reports Digital Music News. A source also said Napster executives are considering various exit options, "including a fire sale or liquidation." A Napster representative denied those claims. One has to wonder how long the company can unsuccessfully grasp for traction in an increasingly competitive environment. The company will announce its third quarter results after the close of market on February 8th.

paidContent claims the industry grapevine has some Napster chatter. "Someone told me RealNetworks might be interested in the company...someone else told me it could be Microsoft/MSN," wrote Rafat Ali. The Register reports of similar chatter, "in particular that the company is making job cuts here in the UK."