Loudeye Wants Song to Remain The Same
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Just a few weeks after slashing 18 percent of its workforce, Loudeye Technologies Inc. Wednesday bought privately-held DiscoverMusic for an undisclosed sum.
In doing so, Loudeye has picked up what has become the largest provider of song samples, in addition to being a leading provider of album cover art and data to online music retailers. With its brand firmly established, DiscoverMusic services many major online music retailers, including Amazon.com, BMG Direct and CDnow.
By adding a leading song sampler to its campaign (DiscoverMusic has served over 500 million song samples to over 80 online music customers in the past year), Loudeye hopes to pull ahead of the pack.
Together, the conjoined firms hope to host one of the world's largest databases of song samples, including more than 2.5 million samples from about 190,000 CDs, and a pending video sampling service for movie trailers in Windows Media and RealAudio formats.
To be sure, the digital music industry has absorbed its fair share of turbulence with numerous copyright suits and the Napster fiasco, all of which raised the ire of everyone involved -- music fans, artists and the great big record companies.
But the sector was shocked when Bertelsmann, parent company of BMG Entertainment, said last October that it was cooperating with Napster on music subscription service. That bold move has paved the way for firms such as Loudeye to take up their own cause for market share, as was reflected by Wednesday's purchase of DiscoverMusic.
Accounted for as a purchase transaction, Loudeye anticipates the acquisition to close subject to the satisfaction of customary closing conditions, including the approval of DiscoverMusic's shareholders.