Motorola to Acquire Soundbuzz

Schaumberg, Illinois, based Motorola Inc. is all set to expand its mobile music operations in Asia by acquiring Soundbuzz Pte. Ltd. Soundbuzz is an online music retailer based out of Singapore, and Motorola is hoping this move will help push its offerings in the domain of mobile music upwards in Asia.

Motorola’s acquisition of Soundbuzz is based more or less on the scenario surrounding the mobile music market in Asia. More than 90 percent of all digital music in Asia comes through mobile networks and channels, and there are indications this figure is set to remain as it is for the next few years at least.

Motorola has been delivering mobile music through its MOTOMUSIC service for the past two years to customers largely in China, Taiwan, and Hong Kong. With this acquisition, Motorola is now set to expand its mobile music services into other geographies, such as India, Australia, and Southeast Asia, and is also hoping to see a resurgence of its products’ sales in the global market.

Though there has been no official word out yet on the terms of the deal worked out, the deal is set to reach closure in the first quarter of 2008 itself, and is subject to the standard conditions applicable under such circumstances.

Motorola has been going through a slump recently in its mobile phone business. It has dropped to #3, behind Nokia Corp. and Samsung Co. in global sales last year, and has also replaced its CEO recently. There has been a drop in the company’s shares as well, falling from $26.30, a six-year high it achieved in October 2006, to a low $15.07 on January 4 this year.

With this acquisition, Motorola can now leverage the already existing music delivery platform of Soundbuzz, spread across multiple geographies, to ensure a larger customer base has access to and are able to download and purchase digital music content from Motorola.

Talking about the proposed acquisition, Bill Werner, senior vice president, future solutions and technology for mobile devices at Motorola said, “We are very pleased to announce this transaction with Soundbuzz. It will provide Motorola with one of the most extensive music libraries in the Asia Pacific region, advance our music and video offerings in Australia and South East Asia, and build on the success of our MOTOMUSIC Services in China.”

Werner also said, “We are delighted to welcome Soundbuzz's strong management whose extensive region specific experience in the music and video industries will enhance the strength of our mobile device teams.”

Speaking about the acquisition, Soundbuzz CEO Sudhanshu Sarronwala said, “Motorola's dedication to enhancing the digital music experience in Asia complements our own objectives and makes it the ideal partner. This combination will help us extend our platform and create exciting growth opportunities for Soundbuzz's employees and our partner music labels. Further, our customers will benefit from the technological advancements that we expect to deliver as part of a global leader in mobile communications.”