MusicNet deal provides Real profits
Published: 23 Apr 2003 12:11 BST
RealNetworks paid about $1.25m (£792,317) to its MusicNet venture for royalties and services last year, but it recouped nearly $1.6m (£1m) from the streaming-music subscription service, a regulatory filing disclosed late on Tuesday.
The Seattle-based multimedia company received payments of $760,000 from MusicNet for license and service agreements, as well as $620,000 for office-space rental and $217,000 for administrative services, according to a RealNetworks proxy statement submitted to the Securities and Exchange Commission.
Financial details from the MusicNet deal come just one day after RealNetworks said it agreed to buy Listen.com, a rival music-subscription service. MusicNet, a joint venture between RealNetworks, Bertelsmann, AOL Time Warner and EMI Group, was launched in 2001 as technology that offers Web visitors a legal alternative to downloading and streaming music files. RealNetworks owns nearly 40 percent of the service. Analysts said RealNetworks' buyout of Listen.com throws the future of the venture in question.
RealNetworks' proxy statement also said that RealNetworks chief executive and chairman Robert Glaser "received no cash or equity remuneration for his services as chairman and director of MusicNet."
Glaser received no bonus in the previous two years as well, and he remains one of the lowest-paid executives of the company, according to the proxy. Glaser was paid $200,000 as chief executive and chairman in 2002. Still, Glaser owns about 53.5m shares of RealNetworks, or about one-third of the company.
RealNetworks president Lawrence Jacobson received about $350,000 in salary, nearly $280,000 in bonuses, and 250,000 options.
The proxy also showed that Glaser closed a small software company, Washington-based NonStop Entertainment Software, which he owned in March. During 2002, RealNetworks paid NonStop about $6,150 for royalties and fees -- an amount that exceeded 5 percent of the company's gross revenue for the year -- to produce video games that RealNetworks had agreed to promote and sell.
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