LONDON (CelebrityAccess) — The UK-based virtual reality music company MelodyVR has announced plans to acquire venerable digital music brand Napster/Rhapsody International from RealNetworks.
The deal, worth $70M, was completed for $15M in cash, $11M in MelodyVR stock, and assumption by MelodyVR of approximately $44M in payment obligations, primarily to various music industry entities.
“Rhapsody and Napster have travelled a long and winding road,” said Rob Glaser, Chairman and CEO of RealNetworks and Chairman of Napster. “We first became involved with Rhapsody when we acquired Listen.com in 2003, and then Rhapsody acquired Napster in 2011. We are proud of our stewardship of this pioneering business and iconic brand, and grateful for the hard work by the entire Napster team to keep the torch alive all of these years. We’re delighted to pass the baton to Anthony Matchett and the innovative team at MelodyVR. We’ll continue to root for Napster and are pleased that we’ll be ongoing stakeholders in MelodyVR’s success.”
According to a financial filing, MelodyVR plans to leverage Napster’s music library, comprising in excess of 80 million music tracks, to its own platform of VR music performances and live streamed
events as it seeks to scale it subscription offering.
MelodyVR also anticipates that Napster will provide a revenue stream from its existing business, which operates cross Europe, North America, Latin America and the Asia Pacific region.
The MelodyVR acquisition is expected to close in the fourth quarter of 2020.
Rhapsody, which launched in 2001 was the first streaming music service to offer access to a library of on-demand music for a monthly fee. At launch, Rhapsody offered material from Naxos and indie labels but within a year had added catalog from majors such as BMG, Warner, EMI, Sony and, finally, UMG by the end of 2002.
In 2003, RealNetworks acquired Rhapsody parent Listen.com and the company was later positioned as an independent entity in 2010.
Rhapsody then acquired the Napster brand in 2011 and rebranded officially as Napster in 2016 and transitioned to a B2B focus for the digital streaming platform.