HITS Daily Double
"The opportunity to add Listen.com’s Rhapsody, the best music subscription service, into our family of services was just too compelling to
pass up."
——Rob Glaser, RealNetworks


Tech Giant Picks Up Veteran Netco for Rhapsodic $36 Million
Thanks in large part to its well-regarded Rhapsody online music service, netco Listen.com is being purchased by tech giant RealNetworks for around $36 million in cash and stock.

The transaction was announced on 4/21 by Real chieftain Rob Glaser and Listen CEO Sean Ryan, who say they expect to close the deal (pending regulatory approval) by late Q2 or early Q3.

As part of the deal, Ryan will join RealNetworks as VP of Music Services for the company's RealOne division. Listen founder Rob Reid will be dubbed VP of Strategic Development. Listen will remain in its hometown of San Francisco.

In February, Real made a "strategic minority investment" of an undisclosed (but apparently elephant-sized) amount in Listen.

In case your memory is fuzzy, Real makes that RealPlayer thingie on your computer. Your computer is that big thing on your desk that looks kinda like a TV. Real’s multi-media SuperPass service offers news, sport and entertainment.

With Rhapsody on board, Real is positioned to challenge other online music providers—notably Apple, which will be announcing its own service next week—at a time when content providers appear to be gaining the upper hand at last in their struggle against unauthorized downloading (see story, 4/21).

Listen is one of the few online music entities to survive the catastrophic post-bubble era. Rhapsody, which debuted in 2001, sealed the fifth of its licensing deals with the Big Five last summer. It has since extended its reach with a dizzying series of initiatives and a veritable blizzard of press releases.

Listen has distribution agreements in place with an array of ISPs and other companies, including Time Warner Cable's Road Runner, Charter Communications, Verizon Online, Sprint, Gateway, Lycos and Sony Musiclub.

"The opportunity to add Listen.com’s Rhapsody, the best music subscription service, into our family of services was just too compelling to pass up," declared Glaser. "And believe me, ‘compelling’ is a word I use very sparingly—at most, 65-70 times an hour."

"RealNetworks has a world-class technology infrastructure and a demonstrated ability to reach a broad consumer audience with compelling entertainment content," barked Ryan, who also saves "compelling" for special occasions. "Backed by these extensive resources, we are in a strong position to grow the online music market by strengthening Rhapsody, licensing a wider variety of music, and offering even more value to new distribution partners."

Real will release an "integrated financial outlook" on 4/29, and the company says it expects the Listen acquisition will be reflected in its Q2 numbers.