March 17, 2008

By By Antony Bruno, Denver

LiveWire Mobile has acquired mobile music service provider Groove Mobile for $14.5 million.

Groove Mobile powers the mobile music stores of such wireless operators as Sprint in the U.S., as well as Bell Mobility in Canada and 3 UK. LiveWire Mobile is a division of NMS Communications, which provides mobile personalization and content services to various carrier partners.

The acquisition allows LiveWire mobile to offer full-song downloads along with ringtones, videos and other music-related content services. However it also provides some insight into the state of the mobile music industry.

According to the press release announcing the acquisition, Groove Mobile made $7.4 million in revenue last year operating the mobile music services for 12 wireless operators. It's unclear how much Groove makes from each downloaded track after the wireless operator and the record labels take their cut. But based on the $7.4 million sales figure, that cut is either very small or very few songs are being purchased via Groove-enabled mobile phones, or both.

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