Tesco Buys Music Streaming Site We7 for £10.8m
Supermarket giant Tesco has confirmed that it has bought a controlling stake in internet radio site We7.
Tesco confirmed it bought a 91 per cent stake in the company, which has cost a cool £10.8 million, and will buy the rest of the shares in the coming weeks.
The news comes in the same week its rival Sainsbury’s purchased HMV’s 64 per cent stake in Anobii, an e-book business, which has 600,000 users worldwide and a library of 60,000 e-books, for a nominal £1.
We7 was launched in 2007 and was the first UK streaming site to make a profit from streaming music legally. The service is funded via advertising and boasts an impressive 11.1 million tracks available to stream in the UK and Ireland.
It’s not the first time Tesco has bought up a digital startup either – last year Tesco bought Blinkbox, an online movie and TV service, in a bid to improve its digital entertainment offerings.
In what is being seen as a shrewd move by Tesco, it’s thought that the supermarket will bundle streams of music with the physical purchases – something it offers with DVDs and their Blinkbox video streaming service.
While physical purchases are still incredibly important for Tesco they obviously realise that offering the digital version will help make the move from physical to digital smoother for the supermarket chain.
CEO of We7, Steve Purdham, was obviously delighted by the purchase and said: “We are very excited by the prospect of teaming up with Tesco.
“Tesco has been an innovator in entertainment retailing for many years and we look forward to continuing this innovation digitally.”
Tesco’s digital director Mark George gave a hint that there would be some “interesting” changes in the pipeline for the service. He said in statement: “Tesco is already one of the UK’s largest retailers of CDs; this move will help us offer a greater choice for the growing number of customers who want to access music instantly on any device, whenever and wherever they want.
“We7 has a great team and a good technology platform from which we can launch a range of digital music services in the future.”