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Digital
Real’s Rhapsody to become its own company
By CMU Editorial | Published on Wednesday 10 February 2010
Rhapsody, the US-based subscription-model digital music service co-owned by RealNetworks and MTV, will become its own concern, rather than an offshoot of Real. The move will also see Real reduce its stake in the company, which currently stands at 51%.
RealNetworks will pump $18 million into the new company, while MTV will commit to provide the service with $33 million in advertising air time, though will be allowed to cancel its existing ad-time agreement with the service. The original agreement stems from when MTV first became a partner in the digital business, the result of it closing down its own US-based digital music venture URGE and merging that service’s staff and subscriber base into the Real outfit.
Real say that the restructuring of Rhapsody won’t affect its label deals or 700,000 subscribers, and that the digital service will continue as normal.
