Groove goes to NMS for $14.5M

NMS Communications Corp. subsidiary LiveWire Mobile said it pocketed Groove Mobile for $14.5 million — less than half the investment capital the startup had attracted in its six-year existence.
LiveWire, which was rolled out as a separate division in December, targets carriers with personalization services including ringtones and ringback tones. The subsidiary aims to leverage Groove’s distribution channels and content portfolio “to provide operators with a single managed service and subscribers with a superior music experience.”
Groove has made impressive headway in both on- and off-deck mobile music. The company claims 12 carrier customers including Sprint Nextel Corp., 3 U.K. and Bell Mobility, and has relationships with music labels EMI, Sony BMG, Universal Music Group and Warner Music Group.
Launched as Chaoticom Inc., Groove brought in a total of $32 million in funding since 2002. LiveWire’s acquisition — which seems like a bargain-basement pick-up — appears to underscore the difficulties carriers and vendors face in the world of full-track mobile music downloads.
“This acquisition represents a major milestone in solidifying LiveWire Mobile’s early leadership position in the large and rapidly growing market for mobile personalization services,” said LiveWire President Joel Hughes. “Through our fully managed and integrated service offering, we can empower operators to cross-sell and up-sell personalization services while delivering a better mobile experience, resulting in higher levels of service adoption, usage and operator profits.”