US media and entertainment company Clear Channel Communications has announced the acquisition of ThumbPlay's digital music streaming service, which it will look to incorporate into its own radio streaming business.
According to Business Week, the acquisition deal doesn't include ThumbPlay's mobile ringtone business, which will be sold at a later date.
ThumbPlay, which was launched in March 2010, allows users to stream unlimited music files on their mobile devices for a $10 monthly fee. The company managed to attract 20,000 users before Clear Channel picked it up.
The terms of the deal were not disclosed but All Things D's sources communicate that the investors who pumped in $41 million to the company don't expect to get all of their money back.
Clear Channel is America's largest radio company with 850 radio stations in over 150 cities that are accessible over the web using the iHeartRadio service. The company plans on incorporating ThumbPlay's technology into its own free web-based radio structure to compete with other radio streaming services like Pandora.
Evan Schwartz, Thumbplay’s chief executive officer, said in a statement, “We are extremely proud of the digital music products we’ve launched, and Clear Channel has recognized the real value of what the Thumbplay team has developed.”