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On December 23, 2015, we completed the acquisition of technology and intellectual property from Rdio for $77.5
million, which includes $2.5 million in additional purchase consideration transferred prior to the closing of the acquisition. In
November 2015, Rdio sought protection in the United States Bankruptcy Court for the Northern District of California and
began to wind down its business. Our acquisition of technology and employees from Rdio was subject to the approval of the
Court, which was obtained on December€22, 2015. Goodwill generated from the assets acquired is primarily attributable to
expected synergies that will allow us to broaden our subscription business and roll out a multi-tier product offering. We have
accounted for this acquisition as a business combination, and the financial results of Rdio are included in our consolidated
financial statements from the date of acquisition. As a result of the sale of assets, Rdio discontinued its service as of
December€22, 2015.
Other acquisitions
During the year ended December€31, 2015, we completed the acquisitions of Next Big Sound ("NBS") and KXMZ-FM
("KXMZ"). These acquisitions were not material to our consolidated financial statements, either individually or in the
aggregate.
We have included the financial results of Ticketfly, Rdio, NBS and KXMZ in our consolidated financial statements from
their respective dates of acquisition. Pro forma results of operations related to our acquisitions, other than Ticketfly, during the
year ended€December€31, 2015€have not been presented because they are not material to our consolidated statements of
operations, either individually or in the aggregate.
The fair value of assets acquired and liabilities assumed from our acquisitions were based on a preliminary valuation and
our estimates and assumptions are subject to change within the measurement period. Measurement period adjustments that we
determine to be material will be applied to the period in which the amounts are determined in our consolidated financial
statements.
The following table summarizes the allocation of estimated fair values of the net assets acquired during the year
ended€December€31, 2015, including the related estimated useful lives, where applicable:
Ticketfly Rdio Other
Estimated
fair value
Estimated
useful life
in years
Estimated
fair value
Estimated
useful life
in years
Estimated
fair value
Estimated
useful life in
years
(in thousands, except for estimated useful life)
Intangible assets:
Customer relationships - clients $37,300 8 $—$—
Developed technology 28,100 5 26,400 2-5 1,550 4
Tradename 10,400 8 1,000 3 320 2
Customer relationships - users 1,000 2 — 940 2
FCC license - broadcast radio — — 193
Tangible assets acquired, net 27,640 1,969 (490)
Deferred tax liabilities (1,738)— (49)
Net assets acquired $102,702 $29,369 $2,464
Goodwill 232,641 48,131 23,103
Total fair value consideration $335,343 $77,500 $25,567
Goodwill generated from the Ticketfly acquisition is primarily attributable to expected synergies from future growth and
strategic advantages in the ticketing industry. Goodwill generated from Rdio is primarily attributable to expected synergies
from future growth and strategic advantages in the online streaming music industry. Goodwill generated from all other business
acquisitions during the year ended December€31, 2015 is primarily attributed to expected synergies from future growth and,
also for NBS, the potential to expand our Artist Marketing Platform ("AMP"). Goodwill generated during the period related to
Table of Contents
Pandora Media,€Inc.
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