LiveOne Confirms ‘Amended’ Tesla Partnership, Including the End of Subsidized Subscriptions for Certain Vehicle Owners
LiveOne has announced an “amended” Tesla partnership that includes the end of subsidized subscriptions to the music platform for certain vehicle owners. Photo Credit: Bram Van Oost
Tesla has retooled its partnership with music platform LiveOne (NASDAQ: LVO), shares in which suffered a double-digit slip following the new deal’s announcement.
LiveOne just recently described the pact’s key elements in a standalone release. The Los Angeles-headquartered audio-entertainment service has long been a big part of Tesla’s screen-dashboard music offering – with the vehicle company even subsidizing LiveOne subscriptions for those who pay for Tesla’s own Premium Connectivity subscription.
Under the adjusted tie-up, though, the subsidies are no more. Slacker-powered LiveOne spelled out that “Tesla will no longer subsidize LiveOne products to some of its customers.” Expected to go into effect on December 1st, the change is rather predictably eliciting less-than-positive feedback from impacted customers.
“Starting December 1, 2024, your LiveOne powered by Slacker Radio account will no longer be included with your Premium Connectivity subscription,” reads the message Tesla sent to these customers, per one of the many Reddit posts on the subject.
Closer to the present, Tesla has already replaced its “streaming button with LiveOne’s in perpetuity,” and “Tesla will continue to pay LiveOne monthly for grandfathered users in perpetuity,” per the music and podcast business. Said grandfathered users seemingly refer to individuals who received lifetime Premium Connectivity access after purchasing Tesla vehicles by certain dates years back.
Importantly, the “amended partnership” is poised to run through May of 2026, and Tesla owners will, of course, have the option of springing for LiveOne premium ($10.99 monthly in the States) on their own dime. The Kartoon Studios partner also intends to “offer all Tesla customers discounted LiveOne music packages.”
Emphasizing the potential conversions at hand, LiveOne pointed to the possibility of multiplying ARPU by three. But it goes without saying that the digital music landscape is highly competitive, with Spotify and other on-demand platforms standing out as viable replacements for LiveOne.
Moreover, while they might be knee-jerk reactions to the loss of a perk, a number of purported LiveOne users are signaling resistance, discount or no discount, to subscribing out of pocket.
Shifting to the precise fiscal fallout, LiveOne had previously driven home the significance of the Tesla union with regard to its own balance sheet. “Our business is dependent, and we believe that it will continue to depend, on our customer relationship with Tesla, which accounted for 53% of our consolidated revenue for the three months ended June 30, 2024,” LiveOne spelled out in its most recent earnings report.
Bearing that information in mind, LiveOne has substantially lowered its fiscal 2025 consolidated-revenue guidance to between $120 million and $135 million. At the time of this writing, LVO had rebounded slightly to 74 cents per share, which nevertheless marks a close to 40% falloff across the past five trading days.
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