Tesco has splashed out £10.8m on the acquisition of British digital music service We7, a former Spotify rival which now focusses on providing personalised radio stations.
Co-founded by Steve Purdham and former Genesis frontman Peter Gabriel We7 the format is attempting to carve out a niche for itself in a competitive market and is set to launch additional services in the coming months.
Remarking upon the deal Purdham said: “We are very excited by the prospect of teaming up with Tesco. With its loyal customer base, numerous marketing channels and international reach, we believe Tesco is the perfect partner to bring We7’s music services to a wider audience. Tesco has been an innovator in entertainment retailing for many years and we look forward to continuing this innovation digitally.
“I think there is room for lots of digital music streaming services and we still haven’t seen one of the biggest players, Apple, fully wade into this space…but we feel there is more commercial gain to follow the radio model with ‘on air’ adverts rather than subscription services and free on demand streaming.”
Tesco has already purchased online movie and TV service Blinkbox as it attempts to diversify its offer.