Tribune expands music business with Gracenote purchase
Tribune Co. is purchasing the music metadata firm Gracenote in an $170 million agreement with Sony Corp. of America, the company announced Monday:
Gracenote is the largest source of music data in the world, featuring metadata for more than 180 million tracks, which helps power more than a billion smart phones and tablets, as well as the world’s most popular streaming music services.
The purchase comes as Tribune continues its transition away from publishing and ends the year having cut $90 million in print division compensation costs as of the third quarter.
Gracenote, a leader in music recognition technology used in listening to music on smartphones and tablets, also provides data and information on movies and TV shows.
Gracenote will be joined with Tribune Media Services "creating one of the largest entertainment metadata companies in the world," according to the Tribune statement. The deal, subject to regulatory approval, is expected to close in the first quarter of 2014.
Meanwhile, Tribune proposal to separate eight newspapers from its television and digital companies is drawing criticism from staff and analysts jittery that the move undercuts the print properties' chances at survival, The New York Times' Ravi Somaiya reports.
As described earlier this month, the proposal calls for Tribune to spin off its newspapers, including the Los Angeles Times, Chicago Tribune and The Baltimore Sun, as a means of avoiding large capital gains taxes that could result from an outright sale.
The plan calls for the newspapers to pay Tribune rent and a dividend, a move questioned by Angie Kuhl, the Sun's Washington-Baltimore Newspaper Guild unit chair. She told the Times:
“It feels like we’re being hobbled. Money that could go into online ventures and exploring new markets is going into rent.”
Tribune said in November it would reduce the payroll by 700 positions, although few would come out of newsrooms. The Guild remains skeptical, according to the Times:
“Their theory, that if only we keep cutting we’ll eventually be lean enough and we’ll be stable, has been discredited,” said Bill Salganik, a former president of the Washington-Baltimore Newspaper Guild, pointing to newspapers across the country that have lost readers and advertisers by thinning their ranks.