Tuesday, March 18, 2008

LiveWire Mobile gets into the Groove to the tune of $14M

LiveWire Mobile Inc, a recently created subsidiary of wireless technology developer NMS Communications Corp. of Framingham, has snatched up Bedford mobile music platform provider Groove Mobile Inc. for $14.5 million.

LiveWire was created by NMS Communications in December.

Combined with LiveWire's existing ringback tones and ringtones, the acquisition of Groove Mobile will allow the company to offer a portfolio of managed services, including Groove's full-track downloads, delivered through an integrated storefront, according to company officials.

Under terms of the acquisition agreement, LiveWire Mobile will obtain all the outstanding shares of Groove Mobile, and Groove Mobile shareholders were required to retire all previously outstanding non-trade indebtedness. LiveWire Mobile will hire most of the Groove Mobile employees and the two companies will consolidate office locations, officials said.

Groove Mobile's technology allows mobile phone users to download full tracks of music directly to their phones, and boasts recording and distribution partnerships with a number of big names, including Vodafone, MTS Allstream and Sony BMG. In September of 2007, the company reported 35 million transactions completed since launching its service in 2004

Groove Mobile was born as Chaoticom Inc. in 2002 out of research by Kevin Short, then an associate professor of mathematics at the University of New Hampshire. Short discovered an aspect of chaos theory that could not only compress a 4Mb audio file into 600Kb but would also naturally encrypt the data. The group applied the compression technology to music in the mobile environment to create the new company.

The company brought in a total of $32 million in funding since 2002. Investors include Egan-Managed Capital and Charles River Ventures.