Original URL: https://www.theregister.com/2012/01/27/beyond_oblivion_debtors/
Startup goes titsup: Beyond Oblivion's crash is beyond belief
Murdoch, charity also face write-offs as digital music outfit goes bust
Posted in On-Prem, 27th January 2012 09:28 GMT
It isn't just scofflaw copyright criminals who cause grief for the music business. Sometimes it's quite capable of lining up its own feet for a shooting party.
Digital music's answer to Boo.com – Adam Kidron's music startup Beyond Oblivion – has gone bust. It owed creditors between $100m and $500m, but had assets of just $10m, according to bankruptcy filings in a New York court. The startup filed for Chapter 11 protection just after Christmas, without ever launching its service. It left two of the four major labels – Sony and Warner – exposed to $50m of "trade debt" each. News International had invested $11.2m, along with – and it's quite surreal, this one – the medical charitable foundation, The Wellcome Trust.
How making a speculative investment in a digital music service squares with the Trust's goal of "achieving extraordinary improvements in human and animal health" is a mystery only the Trust can answer. Perhaps carrying around so much cash was giving the Trust a bad back – and Beyond Oblivion offered relief. Wellcome has also invested in - of all things - undersea cable for the US, UK, Canada and Iceland.
A Beyond Oblivion spokesman explained to us last spring that the concept was similar to Nokia's Comes With Music, with unlimited music being bundled with mobile devices. He added that most of the investment was rapidly circulated along to the record companies. But Beyond Oblivion also splashed big on marketing. The company spent heavily on selling itself – you can catch a bit of that flavour in this corporate vid:
A demonstration promised for June came and went, and little more was heard.
Adam Kidron is the son of Michael Kidron, a Marxist theorist and editor at Pluto Press [obit]. Kidron's previous internet venture, Urban Box Office, also spectacularly burned through tens of millions of investment before going titsup in 2001. ®