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 – taking on the likes of Spotify and Apple Music.
In addition to acquiring technology and intellectual property from Rdio, members of Rdio’s team will be offered roles with Pandora, subject to close of the agreement.
The transaction is contingent upon Rdio seeking protection in the United States Bankruptcy Court for the Northern District of California.
Upon approval of the proposed transaction by the bankruptcy court, Rdio will be winding down the Rdio-branded service in all markets.
Pandora is not acquiring the operating business of Rdio.
The transaction is subject to the approval of the Bankruptcy Court, which will supervise an auction for the assets of Rdio.
“Whether streaming through radio, on-demand or in-person at live events, Pandora is building the definitive source for fans to discover and celebrate music,” said Brian McAndrews, chief executive officer at Pandora.
“Wherever and however fans want to hear music, we intend to be their go-to destination.”
Pandora said it expected “to offer an expanded Pandora listening experience” – which sounds very much like an interactive streaming service – by late 2016, pending its ability to obtain proper licenses.
MBW has previously speculated that Pandora’s new licensing deal with Sony/ATV may involve elements related to interactive streaming.
The Rdio acquisition news comes one month after Pandora bought ticketing firm Ticketfly for $450m.
“We are defining the next chapter of Pandora’s growth story,” continued McAndrews. “Adding live music experiences through Ticketfly was a transformative step.
“Adding Rdio’s impressive technology and talented people will fast-track new dimensions and enhancements to our service. I couldn’t be more optimistic about Pandora’s future and the future of music.”
“The Rdio team built an acclaimed product and technology platform that has consistently led innovation in the young streaming industry. I’m pleased that many members of the Rdio team will continue to shape the future of streaming music, applying our tradition of great design and innovative engineering on an even larger stage with Pandora,” said Anthony Bay, chief executive officer of Rdio.Music Business Worldwide