ReaNetworks has made its biggest mobile content acquisition, buying our ringback and mobile music and content platform firm WiderThan, for about $350 million. WiderThan started in Korea, and pioneered the ringback tones there and worldwide…its move into U.S. has been more on the mobile music platform side…it power Verizon VCast Music.
Rationale: “This acquisition is complementary to RealNetworks’ strategy of providing end-to-end digital media solutions to partners such as Cingular, Comcast, Sprint and Telmex. The companies’ geographic footprints are complementary, with both companies enjoying market penetration in North America, while RealNetworks is strong in Europe, and WiderThan in Asia. This acquisition also provides RealNetworks with technology and customer relationships to extend its market-leading music subscription service into the rapidly growing mobile music space.”
For H1 2006, WiderThan had $61.9 million in revenue, an increase of 39% over the same period in 2005. Net income for H106 was $7.4 million, an increase of 79% from the prior year. As of June 30, 2006, WiderThan had approximately $93 million of cash, cash equivalents and short-term financial instruments.
RealNetworks intends to keep the WiderThan brand intact, operate the business as a wholly owned subsidiary and maintain its existing employee base.
An analyst conference call webcast discussing this deal is at 2 PM PST, here.
The PDF presentation about the deal is here.