RioPort Inc. Wednesday announced it has closed $30 million in first-round
venture financing and has begun operating as a separate company.
Rioport was previously operating as a subsidiary of S3
Inc., which recently acquired RioPort’s parent company, Diamond Multimedia.
Oak Investment Partners and Vulcan Ventures, Inc. have provided RioPort with
operating capital to further build and proliferate its integrated digital
audio platform for the delivery, management and playback of music and spoken
audio content. RioPort will utilize the funds to invest in Internet and
content aggregation activities, application software development and design
services. S3 and Diamond Multimedia have funded the company since its
inception.
Rioport and Viacom’s MTV Networks Online have also finalized a multi-year
e-commerce and equity agreement. Under the terms of the deal, MTV Networks
Online, and its subsidiaries MTVi and Nickelodeon Online, will receive a
share in revenues generated from digitally downloaded music sales across the
MTV Networks Online network. MTV Networks Online will also receive an equity
stake in RioPort. In addition, RioPort is licensing to MTV Networks Online
customized versions of its RioPort Audio Manager for all of the MTV Networks
brands, including MTV, VH1, SonicNet and Nickelodeon. In turn, MTV Networks
Online will provide Rioport with content and promotional support.
“RioPort’s ability to raise $30 million in financing underscores the
investment community’s belief in our ability to successfully execute on the
digital audio opportunity by delivering the first fully integrated, secure
platform for experiencing music and spoken audio programming from the
Internet,” said David Watkins, president of RioPort, Inc. “These
investments, along with our alliance with MTV Networks Online, provide a
strong foundation for building RioPort into a major player in the digital
audio solutions market.”
“RioPort gained an extremely
valuable foothold in the digital audio space by being the first company to
provide consumers with a portable solution for MP3 music playback. We see
vast potential in RioPort’s ability to now deliver to consumers through its
portal customers, a complete digital audio solution,” said Fred Harman of Oak Investment Partners.
“RioPort’s innovative digital audio platform is a natural fit for our
portfolio of Wired World investments,” said William Savoy, president of
Vulcan Ventures.
Central to the RioPort platform is its RioPort Audio Manager Software, which
allows people to acquire, manage and play back digital audio tracks from
their desktop PC or portable player. In addition to providing the RioPort
Audio Manager to consumers, RioPort is licensing customized versions of its
software design to outside parties. RioPort is also a distributor of digital
audio content through its RioPort.com site, an Internet destination for
accessing music and word programming, digital audio hardware, software and
tools, consumer services, and information. In addition, RioPort designs
portable digital audio appliances, including the Diamond Rio 500, which it licenses to third-parties for market delivery.
