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Rhapsody's New Partnerships Could Give It An Edge Over Spotify

Rhapsody's New Partnerships Could Give It An Edge Over Spotify

Rhapsody is the oldest streaming music service in America, but it hasn't enjoyed the massive success that accompanied the launch of Spotify and Pandora (NYSE: P). The company hopes to change that with a couple of new partnerships.

Rhapsody announced Friday that it has partnered with Flipps, a multimedia app that allows users to stream video to smart TVs and TV-connected devices. The deal will allow Flipps' 10 million users to project Rhapsody content onto any connected TV.

"Flipps, for us, represented an opportunity to syndicate and share [our content] more broadly," Paul Springer, Rhapsody International's SVP of Americas and chief product officer, told Benzinga. "We couldn't be happier about the Flipps product or the traction that they're getting or our ability to contribute content to that platform."

Related Link: Shares Of Pandora Active After Hours On Report Google Considered Buying Spotify

A New Kind Of Radio

The Flipps deal is one of two that Rhapsody announced this summer. The company inked a deal last month to distribute its new Internet radio service, unRadio, with T-Mobile (NYSE: TMUS).

"We just launched a product called unRadio, which goes directly at Internet streaming radio -- the Pandoras of the world -- and solves key pain points," said Springer. "We did that in conjunction with direct licensing from the labels versus statutory rates or DMCA-compliant rates. We were able to build a better product as a result of that."

Building The Brand

Both of the partnerships represent a new chapter for Rhapsody, whose global subscriber base increased 63 percent during the first quarter.

"I think it builds our brand," Springer said of the Flipps deal. "It certainly is artist-friendly, which is what we're all about, and gives us more reasons to invest in not only just our catalogues but artist interviews and performances."

As for unRadio, Rhapsody created the service after receiving feedback from customers who were dissatisfied with existing Internet radio services.

"There were a bunch of pain points that customers had," said Springer. "They hated advertising, they hated the fact that they were arbitrarily controlled on the number of skips they can do. They weren't able to download songs and take [them] with them when they didn't have an Internet connection. So we said, 'What if we could invent something new, what would it be?' Well, let's go invent a new form of radio. That's what we did, and did it alongside T-Mobile as a distribution partner."

Rhapsody isn't ready to announce any specific numbers, but Springer said that unRadio has been "wildly successful."

"We believe it's one of the most successful wireless carrier partners ever right out of the gate," he said. "And there's massive demand for it. It's an example of where we're showcasing that this company can continue to invent and invent a next-generation set of products for music fans around the world. And we're going to continue to do that."

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.


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