RealNetworks CEO Rob Glaser Buys $10 Million in Napster Stock

Napster Settles with Songwriter David Lowery
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RealNetworks founder, chairman, and CEO Rob Glaser has invested $10 million in his company’s stock. According to a recent SEC filing, Glaser’s investment in RealNetworks was funded personally and translates to 8,064,516 shares, with each costing about $1.24. The company’s stock, traded under the symbol RNWK, saw its value jump by about 25 percent upon the purchase’s announcement.

RealNetworks is a digital media company that was founded by Glaser in 1994 with a $1 million investment from his own pocket. Over the years, the company has diversified its offerings to remain competitive in a rapidly evolving market. RealNetworks achieved substantial success during the late 1990s and early 2000s, but most of its digital and computer services were rendered obsolete with the advent of today’s media and tech giants.

In an effort to stay relevant, RealNetworks bought the majority of Rhapsody International, parent company of the digital music store (and former P2P sharing network) Napster, in 2018. RealNetworks previously owned a minority stake in the company. The acquisition allowed RealNetworks to assume ownership of around 84% of outstanding Rhapsody stock, doubling its stake overnight. In the third quarter of 2019, Napster brought RealNetworks additional revenue and additional expenses, with the latter resulting in an uptick in operating losses.

RealNetworks’ revenue for 2019 totaled $172.1 million, up from $69.5 million in 2018. However, $106.3 million of the former figure derived from Napster. Additionally, the brand’s EBITDA (earnings before interest, taxes, depreciation, and amortization) came in at a loss of over $20 million, up from a loss of about $16 million in 2018.

Glaser’s investment in RealNetworks is a sign of his continued faith in the company’s potential. In a statement, he said that he was happy to back the business today and that he had used $1 million of his own money to start RealNetworks in 1994. Glaser, a former Microsoft executive, has been the chairman and CEO of RealNetworks since it debuted. The company was named Progressive Networks between 1994 and 1997.

Notably, Tony Fadell, the “Father of the iPod,” worked at RealNetworks for six weeks in 2000. However, substantial disagreements with Glaser forced him to depart, and he was then hired by Apple.

RealNetworks has been working to pivot its business model in recent years. The company has shifted its focus to developing AI-powered facial recognition technology for law enforcement agencies. The company’s SAFR platform has been adopted by several cities and businesses to monitor public spaces and enhance security.

SAFR is an AI-powered platform that can recognize faces in real-time and deliver analytics to help businesses make data-driven decisions. The technology has been used in a variety of settings, including airports, schools, and retail spaces.

RealNetworks has also developed a suite of products that enable businesses to leverage the power of digital media and improve their online presence. These products include a video streaming platform, a digital signage solution, and a mobile video player.

Despite the challenges RealNetworks has faced over the years, the company remains committed to delivering innovative products and services to its customers. With Glaser’s recent investment, the company is well-positioned to continue its growth trajectory and achieve long-term success.

One Response

  1. Trudy McMurphy

    And in other news…Shawn Fanning just completed his 1st year waiting tables at the San Jose Chili’s. Congrats, big guy!