Loudeye to Exit Content Protection Services Business, Reducing Cost Structure
09 December 2005 - 11:05PM
PR Newswire (US)
SEATTLE, Dec. 9 /PRNewswire-FirstCall/ -- Loudeye Corp.
(NASDAQ:LOUD), a worldwide leader in business-to-business digital
media solutions, today announced an important step in its effort to
focus its business and reduce its cost structure. Loudeye announced
that Overpeer, Inc., Loudeye's wholly-owned content protection
subsidiary, has ceased operations effective immediately and will
continue to pursue options to maximize the value of its assets. As
a result, Loudeye has reduced its quarterly consolidated cost
structure by approximately $1.6 million, or 10%, compared to third
quarter 2005 levels. Overpeer expects to incur approximately
$200,000 in severance and related payroll costs associated with the
closing of its operations, which is expected to be paid during
December 2005. In addition, Overpeer may incur additional wind-down
costs to terminate property or equipment leases, and other
contracts. The cessation of the Overpeer operations may also result
in the acceleration of depreciation or amortization or the
impairment of certain fixed and intangible assets. Loudeye
anticipates that the net assets and results of operations for
Overpeer will be presented as discontinued operations in its
consolidated financial statements. "We continue to focus our
business on growth opportunities with digital distribution. Our
actions to exit content protection services will substantially
improve our go-forward cost structure," said Mike Brochu, Loudeye's
president and chief executive officer. About Loudeye Corp. Loudeye
is a worldwide leader in business-to-business digital media
solutions and the outsourcing provider of choice for companies
looking to maximize the return on their digital media investment.
Loudeye combines innovative products and services with the world's
largest digital music archive, a broad catalog of licensed digital
music and the industry's leading digital media infrastructure
enabling partners to rapidly and cost effectively launch complete,
customized digital media stores and services. For more information,
visit http://www.loudeye.com/. Forward Looking Statements This
release contains forward-looking information within the meaning of
the Private Securities Litigation Reform Act of 1995. These
statements are based on current estimates and actual results may
differ materially due to risks, such as wind-down costs that differ
from original estimates, for example because of unforeseen
complexities of moving equipment or terminating contractual
obligations; amounts for non-cash charges relating to fixed assets
that differ from the original estimates because of the ultimate
fair market value of such fixed assets; and other risks set forth
in Loudeye's most recent Form 10-Q, Form 10-K and other SEC filings
which are available through EDGAR at http://www.sec.gov/. These are
among the primary risks we foresee at the present time. Loudeye
assumes no obligation to update the forward-looking statements.
DATASOURCE: Loudeye Corp. CONTACT: media, Karen DeMarco, mPRm
Public Relations, +1-323-933-3399, or , for Loudeye; or investors,
Michael Dougherty of Loudeye, +1-206-832-4000, or Web site:
http://www.loudeye.com/
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