|[1:30 PM] RioPort To Be Spun Off As "Internet" Company, IPO Imminent
According to C-Net, Diamond Multimedia's RioPort is ready to lead the charge into the world of the IPO. RioPort has officially been spun off from Diamond by the parent company, S3. S3 is attempting to position the new spin-off as an "internet company" before the forthcoming IPO.
Diamond Multimedia, the designers of the Rio, which was the first portable MP3 player, was recently acquired by graphics giant S3. S3 had intended to divide Diamond's assets, and RioPort seems to be the first beneficiary of S3's strategy.
According to the C-Net article:
"This is about actually getting money in the bank so we can operate as an independent company," said RioPort CFO Wade Meyercord.
"In the Net space, the business model is much more toward generating users to build revenue off of them in the long run," he added. "What RioPort does is to get the content from the big music labels--content people would be willing to pay for through our Web site or our partners--and provide the security for the content so it can't be pirated."
RioPort, which supports various digital music formats from MP3 to Windows Media Audio, also relaunched its Web site today, offering music, books, and comedy tracks in MP3 and Windows Media Audio formats.
The company hopes to eventually make money by selling digital downloads. RioPort already has a deal with Universal Music to distribute its artists' tracks via its own Web site and its partners' Web sites, including those for MTV, Nickelodeon, and VH-1.
These alliances and the venture funding are building blocks for a RioPort IPO.
RioPort is going to receive a reported $30 million dollars in capital as a startup from S3, which will help RioPort position itself in the net market against other major music web sites.
RioPort recently released their next generation MP3 player, the Rio 500, and early reaction has been very positive. Along with the hardware, RioPort has also launched a portal-type web site, focused, of course, on music. RioPort.com offers privileges to members, of which registration is free. Along with music, RioPort.com will offer books, music news, various MP3 software, and a help center for assistance in downloading materials.
As of this writing, no date had been announced for the IPO. The C-Net article has more information, and we recommend reading it.
The Mac Observer Spin: S3 is making a good move, and hopefully it will be a move that sees more Mac support in the RioPort. So far, the RioPort has a commanding lead in the portable MP3 market.
RioPort.com - S3 - Diamond Multimedia