Rentrak Sells Pay-Per-Transaction Business5 Feb, 2015 By: Erik Gruenwedel
Rentrak Feb. 5 announced it has sold its namesake pay-per-transaction packaged-media rental business for $7 million to Vobile, a Santa Clara, Calif.-based company specializing in video and audio content protection, measurement and monetization services.
Under the deal, Rentrak received $1 million in cash, a $1 million note due in six months and Vobile preferred stock with a $5 million liquidation preference. Vobile plans to hire all Rentrak PPT employees to continue running the business and will rent space in Rentrak’s Portland, Ore., headquarters.
Last March, Rentrak announced it would sell its PPT business as it transitioned singularly to media data measurement.
Similarly to Netflix, which is building its subscription streaming business in part on the back of its lucrative by-mail disc rental service, Rentrak acknowledged the PPT business since 2006 generated more than $100 million in free cash it has used to build its movie and TV measurement businesses.
“While our PPT business no longer fits with our [core business] strategy, it has provided considerable value for studios and brick-and-mortar retailers for many years,” CEO Bill Livek said in a statement. “Vobile has been a strategic vendor to Rentrak for some time. Knowing them as we do, we are confident that Vobile is fully committed to continuing our longstanding tradition of providing outstanding service to the clients of its PPT business. We look forward to continuing to work closely with Vobile in our information businesses.”