Spotify rival Rdio is set to file for bankruptcy in the US - and has already agreed to sell key assets to Pandora for $75m in cash. The move means that Pandora, previously a pureplay digital radio service, now has the platform its needs to become a fully interactive streaming service. The transaction is subject to the approval of the Bankruptcy Court. The Rdio acquisition news comes one month after Pandora bought ticketing firm Ticketfly for $450m - and Spotify set up its new Concerts service.
Of the $30m in unsecured debt that was declared, Rdio owed $2.4M to Sony Music Entertainment and Rdio owed Warner Music Group $613,374 and Universal Music Group $294,219. Apart from Sony, Rdio’s biggest creditors are partner and set-top box firm Roku Inc ($2.76m owed) and AEG-owned ticketing firm AXS Digital LLC ($1.25m owed). Other creditors of interest to the music industry include Shazam ($1.17m owed), Tunecore ($236k owed) and Merlin BV ($134,960 owed). The Orchard – now a fully-owned Sony Music company – was owed $383,960.
Spotify now has a 49% share of the paid-for music streaming market, according to new MBW research – just as Apple and YouTube ready new services to tackle its dominance. The Swedish streaming platform released its full-year financial results last week, posting a €162m net loss despite revenues of €1.08bn in revenues, of which €982.9m ($1.11bn) came from subscriptions and €98.9m ($113m) was derived from free users.
In terms of ad-funded or ‘freemium’ streaming users – including YouTube and Vevo, as well as Spotify’s free tier – the IFPI concluded that these equated to $641m in 2014. Spotify’s own ad-funded revenue in 2014 stood at €98.9m – $113m ($111m) - giving it just a 12% share.
And with the debate abouts subscription vs freemium streaming services a hot topic, Rdio has launched what some aer calling a 'medium' streaming service - a $3.99 package called Rdio Select. Rdio boss Anthony Bay, speaking to Buzzfeed, said: "We've all been flying airplanes that had business class only. There is no coach".
http://www.musicbusinessworldwide.com/spotifys-dominance-of-music-streaming-laid-bare/
