Pandora Acquiring Key Assets from Rdio
- Tuesday, November 17th, 2015
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Music streaming service Pandora has announced that it is set to acquire key assets from competitor Rdio for $75m ($49m) in cash, with the aim of transforming its current service. Rdio will shut down as a result of the sale.
The sale, which will consist of both technology and intellectual property rights, could see Pandora expanding internationally beyond the US and moving to compete with on-demand streaming services like Spotify and Apple Music.
“Whether streaming through radio, on-demand or in-person at live events, Pandora is building the definitive source for fans to discover and celebrate music,” said Brian McAndrews, CEO of Pandora in the announcement of the purchase, hinting at directions where the company is hoping to develop.
So far, Pandoras proposition has been relatively weak when it comes to on-demand listening, and Rdios technology could well help bolster their strength in this area. Rdio also operate in over 100 countries, giving Pandora an opportunity to expand its global footprint significantly. Pandora also recently acquired concert ticket startup Ticketfly, paying $450m to grow its presence in the live music sector.
The acquisition of Rdio has revealed the financial straits the company had found itself in. The startup had previously raised $125m in funding, and was valued at $500m at one point. Pandoras purchase of assets was contingent on “Rdio seeking protection in the United States Bankruptcy Court for the Northern District of California”, indicating how far the firm has fallen.
While Pandora has stated that it is not acquiring the operating business of Rdio, it has confirmed that many of Rdios employees will likely be offered jobs at Pandora to aid with integrating and operating the new technology.
“The Rdio team built an acclaimed product and technology platform that has consistently led innovation in the young streaming industry,” said Anthony Bay, CEO of Rdio. “Im pleased that many members of the Rdio team will continue to shape the future of streaming music, applying our tradition of great design and innovative engineering on an even larger stage with Pandora.”