Login or signup
36
WIRE

Report: Dropbox Acquires Cloud Music Start-up Audiogalaxy

Meet the 14-year-old start-up that Dropbox reportedly bought this week.

Audiogalaxy founder Michael Merhej.

Advertisement

Dropbox’s core product lies in digital file sharing. But if its reported acquisition of peer-to-peer music start-up Audiogalaxy signals anything, the Inc30 Under 30 alum may also see a future in streaming digital music files from the cloud.

Seattle-based Audiogalaxy announced the move to Dropbox in a blog post yesterday. Similar to personalized radio services like Pandora or Last.fm, the company provides a platform for users to upload music tracks and playlists to their computers and then stream those songs from any device including iOS and Android phones. There aren't many details on the deal yet, as Dropbox has yet to confirm the acquisition.

But the start-up did confirm that their service, which is no longer accepting new users, will shut down at the end of the year, according to the post titled “Hello, Dropbox.”

“We've been talking to the Dropbox team for a while and there became a point when it made sense for us to join them,” Merhej wrote in an email to Inc. “They have incredible customer growth, a fantastic vision, and a first class team of people creating Dropbox.”

But those synergies didn’t always exist.

After Merhej founded Audiogalaxy in 1998, the company reportedly evolved a file-transferring service for free music downloads. But like Napster, Merhej’s P2P start-up eventually ran into a lawsuit from the Recording Industry Association of America. It shut down in 2002, according to a blog post by Audiogalaxy engineer Tom Kleinpeter.

“I tried every trick that I could think of and blocked huge numbers of songs, but it was like trying to hold back the tide,” Kleinpeter wrote.

Audiogalaxy was down, but not out. Over the next few years, the start-up had a short-lived partnership with Rhapsody, followed by another ill-fated partnership with Warner Music Group’s Choruss--and several product iterations. 

The last and current iteration of Audiogalaxy, formed in 2010, is the one that Dropbox will reportedly acquire. When asked about his vision for cloud streaming music moving forward, Merhej gave some hints as to what his service would look like post-acquisition:

At the end of the day, I believe customers want to have two musical experiences available to them - a lean forward experience: you can choose any music track to play right now  and a lean back experience: where some system, human DJ, or playlist selects tracks you want to hear right now or didn't know you want to hear, and plays them without you doing any work. Whatever system can provide these two experiences in a simple and easy to use manner while at the same time creating a profitable business will be a winner.

Dropbox didn't return request for comment in time for this article to publish. 

 

IMAGE: Courtesy Company
Last updated: Dec 13, 2012

MATTHEW WONG is a digital journalist whose work has also appeared in Dow Jones VentureWire and The Wall Street Journal.
@mlcwong




Register on Inc.com today to get full access to:
All articles  |  Magazine archives | Comment and share features
EMAIL
PASSWORD
EMAIL
FIRST NAME
LAST NAME
EMAIL
PASSWORD

Or sign up using: