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Blinkbox Music back up for sale as company goes into administration

By | Published on Friday 12 June 2015

Blinkbox Music

Blinkbox Music is up for sale again, just in case you were kicking yourself for not picking up the streaming service when Tesco was flogging it off late last year. Though this time you won’t get any Clubcard points.

As previously reported, flagging Tesco decided to sell off its digital content business Blinkbox last year, ultimately selling the video-on-demand bit to TalkTalk and the music element to Guvera, the Australian firm that is rapidly expanding its streaming service around the world. The January deal was seen as providing Guvera with a platform via which to launch in the UK market, with the company talking up the “technical expertise” and “established loyal audience” it had accessed via the acquisition.

But then in recent months we started to hear of a number of redundancies at the company, before yesterday it was confirmed that the Blinkbox Music company had been put into administration, with City AM reporting that a total of 100 staff have now been laid off.

A statement from Blinkbox Music’s administrators Smith & Williamson read: “The company has faced significant financial pressure in recent months, since its acquisition by the Guvera Group. This is a highly competitive industry and despite an active user base the business has continued to struggle financially”.

It went on: “[The company] has sought to undertake a financial restructuring, and has reduced staff numbers. However, these financial pressures have continued to grow, and the company’s director, after trying to achieve a quick sale of the company/business, was faced with little choice but to place the company into administration”.

It’s thought a management buy out was attempted before the business was put into administration. The administrators are now trying to seek a buyer, with eight of the firm’s Oxford-based staff kept on in the meantime, though it’s not clear quite who would want the business, despite its stated 2.8 million sign-ups and 200,000 active users.

Given Guvera already has an established brand, and generally utilises the platforms of company’s like 7digital and Omnifone in other territories, the assumption was always that, ultimately, the Aussie firm was mainly interested in acquiring the user-base of Tesco’s streaming service.

Despite getting a relatively good deal for those 2.8 million email addresses, it’s possible the liabilities Guvera took on as part of the deal were too great, given the vast majority of those users are not seemingly active. Though whether the Australian firm could try to buy just the database through the administration remains to be seen.