Looking for Mr. Goodliving? The Finnish mobile video-game company by that name is now in RealNetworks' stable. RealNetworks is announcing today...

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Looking for Mr. Goodliving? The Finnish mobile video-game company by that name is now in RealNetworks’ stable.

RealNetworks is announcing today that it has paid $15 million cash for the Helsinki-based company, extending its games business to mobile devices. The deal, which closed Friday, also gives RealNetworks further ties to phone companies across Europe.

Games are helping the Seattle-based company diversify beyond the digital-media business it pioneered in the late 1990s. Its core subscription music is facing heavy competition from bigger rivals such as Microsoft and Apple Computer. Even Yahoo! is introducing a subscription music service, with pricing that undercuts the RealNetworks’ service.

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Meanwhile, RealNetworks has boosted its games business, partly through acquisitions. Sales nearly doubled in the quarter that ended March 31 and accounted for about 20 percent of the company’s total revenue.

“We see it as a vital piece of our consumer facing businesses,” said Martin Plaehn, the company’s head of games.

Plaehn said Mr. Goodliving will bring RealNetworks’ mobile game portfolio to about 20 titles. RealNetworks plans to continue selling the games through mobile-phone companies and not directly to consumers.

The company expects the purchase will add $3 million in sales through the rest of 2005 and $8 million in 2006. The company today also is raising its 2005 sales forecast to $323 million to $333 million, up from $320 million to $330 million.

Games contributed $12.2 million toward RealNetworks’ total sales of $64.2 million in the first quarter, up from $6.7 million in game sales during the same period a year ago. A major factor in the growth was another acquisition, the $36.2 million purchase of Seattle-based GameHouse in January 2004.

Mr. Goodliving produces games such as a mobile edition of Trivial Pursuit and the Playman Sports series. It also does business with more than 100 phone companies, including T-Mobile, Vodafone and Orange. One of Mr. Goodliving’s key assets is game-publishing technology. It developed software that automates the conversion of mobile games to work on 200 different handsets in 20 different languages, RealNetworks spokesman Jeremy Pemble said.

Mr. Goodliving’s roughly 40 employees will remain based in Helsinki and their offices will become RealNetworks’ headquarters for mobile gaming in Europe. RealNetworks also has offices in London, but Europe accounted for just 3 percent of its sales in the last quarter.

The company can apparently afford the purchase. It had $369.7 million in cash and short-term investments as of March 31.

Brier Dudley: 206-515-5687 or bdudley@seattletimes.com

Yahoo! plans service for music subscription

Yahoo! said it would start a new subscription music service today to compete with Apple Computer and RealNetworks.

The “beta,” or test, version of the service will offer access to more than 1 million songs that can be transferred to portable digital devices, the Sunnyvale, Calif.-based company said yesterday in a statement.

Yahoo! last year bought MusicMatch for $160 million to enter the online music-subscription business.

Customers of the service also will be able to download music files permanently for 79 cents to 99 cents per song. Yahoo! will offer a tool to import and transfer music files to compact discs. The service will cost $4.99 a month in an annual subscription, or $6.99 a month otherwise.

Bloomberg News