Broadcast.com, the Dallas-based aggregator of internet audio and video programming, is acquiring web-hosting company Simple Network Communications Inc for about $21m in stock. Broadcast.com, which in July raised $45m in an initial public offering, said the acquisition will accelerate the expansion of its broadcasting services into the consumer and small business markets, while increasing its network infrastructure. Under the terms of the agreement, broadcast.com will issue shares of its common stock valued at approximately $20.75m in a deal that will be accounted for as a pooling of interests. The transaction is expected to close in the fourth quarter and San Diego-based SimpleNet will become a wholly owned subsidiary of Broadcast.com. The logic behind the deal is that Broadcast.com will make money by leveraging SimpleNet’s customer base – over 15,000 consumer and small business accounts in over 100 countries. The two will work together to introduce self-service audio and video streaming to users of SimpleNet’s web-hosting service. The plan is that users will be able to create and broadcast personalized audio and video programming – including internet-only radio and television shows, business presentations, or home movies – which will be accessible within minutes of setting up the service.
