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May 22, 2007

Could RealNetworks buy Sonos?

Posted by Kim Peterson at 10:48 AM

Business 2.0 columnist John Heilemann interviews John MacFarlane, the founder of Sonos, a Santa Barbara, Calif. company closely tied to Seattle's RealNetworks. The two companies are so tight, in fact, that Heilemann speculates that RealNetworks might buy Sonos one day.

Sonos makes an audio system that wirelessly beams music to speakers throughout a home. Sonos users can connect to RealNetworks' Rhapsody music service without having to go through a PC. For $10 a month, they have access to about 4 million songs to pipe through the home.

Sonos and Rhapsody are each other's killer app. MacFarlane tells me that Sonos customers use Rhapsody "more than 10 times as much as the average Rhapsody user." And, according to Rhapsody insiders, the service's churn rate among Sonos users is tiny compared with the overall figures.

Among those addicted to new music and new technology, the Sonos-Rhapsody combination wins raves so gushing they're almost too embarrassing to print.

MacFarlane tells Heilemann that he's received acquisition offers, but none was good enough to take.

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