Guvera closes UK office amid blinkbox Music sale
Gold Coast-launched music streaming service Guvera has closed its UK office, following financial woes relating to its recently acquired UK rival, blinkbox Music.
Despite being acquired for a reported £4 millionwith 2.8 million members (based mainly in the UK and Ireland), and over 200,000 monthly active users, blinkbox Music had been operating at a loss for some time; it was entered into administration last Friday.
In a statement emailed to TMN, Guvera said its acquisition of blinkbox Music from Tesco in January, lead to a restructure of its UK operations.
“[…] As part of this, a decision has been made to close blinkbox Music. blinkbox Music’s streaming service will no longer be available to customers and the process of closing the service commenced from June 11.”
Guvera had actually attempted to offload blinkbox Music soon after the purchase was finalised. According to MBW, that was because Guvera had no intention of using blinkbox Music’s custom-built digital radio platform or its staff. It had plans to build its subscriber base and reimburse money spent on its growth – Guvera launched in India in 2014 with a focus on adding branded channels.
Guvera is currently available in 20 markets but is yet to expand into the UK and Western Europe. The service addressed this in its statement: “The UK remains an important market for Guvera and further updates in relation to our market entry will be made in the coming months.”
Finbarr O’ConnellandAdam Stephens, fromaccountancy and investment management group Smith & Williamson, were appointed joint administrators of Blinkbox Music on June 11.
Stephens said: “We are currently retaining the company’s Oxford based staff while we search for a buyer. We expect to undertake an accelerated sales process and are trying to work with all stakeholders to preserve value in the business.”
It’s believed Guvera laid off 100 staff at blinkbox in total. Its Chief Commercial OfficerMichael Wallis-Brown left the company in March and its Global Chief Operating Officer Michael de Vere departed last month. MBW has reported de Vere’s proposed management buyout (MBO) of blinkbox Music’s assets was rejected by Guvera’s Australian board last month, just before his exit.
In April this year Guvera reached a milestone of 10 million users. Crucially, this number included its blinkbox subscribers and with its administrators pushing for a fast sale, it will be interesting to see whether the 2.8 million subs brought over by blinkbox are offered up with the sale or not.