MP3 player developer acquired
July 7, 2004 KST 00:24 (GMT+9)
ReignCom Co., a global leader in the MP3 player market, is taking over MPMan.com, the company that developed the first MP3 player.
The company said yesterday that it will spend about 3.4 billion won ($2.9 million) to acquire 96.5 percent of the venture firm. Last May, it was selected as the preferred company for takeover by MPMan.com's creditors and signed a memorandum of understanding. MPMan.com was a leading MP3 player manufacturer until it went bankrupt in July last year.
Significantly, ReignCom will not only buy the company, but patent rights as well. MPMan.com holds the international patent rights to the core technology used in MP3 players ¡ª playing music on portable players using MPEG coded digital music files ¡ª and on the equipment needed to play it. The patents are registered not only in Korea, but also in the United States and China.
The industry is particularly interested in what ReignCom will do once it becomes the owner of the patents. Until now, the Korea Portable Audio Consortium, made up of MP3 player industry participants, has been very sensitive about having MPMan.com bought by a single company. Sixteen companies had been jointly pursuing the takeover of MPMan.com to prevent the patent rights from going to just one company.
Regarding future royalties, ReignCom said that it will try to be fair. "Our company paid a lot because of those patent rights. In that sense, we will try to make fair demands of other companies," said PR director Kim Dong-hwan.
by Yoon Chang-hee <wohn@joongang.co.kr
