MORE NAPSTER/ BMG DETAILS November 11 2000 dotmusic.com Three majors reported to be interested in signing up After a shock Halloween announcement that Bertelsmann, media mogul and owner of BMG Records, would be teaming up with Napster, still further details are surfacing regarding the deal. First came a general re-structuring of the Bertelsmann company, with executives rumoured to be frustrated that the negotiations with Napster were led not by BMG Records but instead by Bertelsmann's Internet department. BMG President and CEO Strauss Zelnick, well-known to have opposed Napster and criticised its business model, resigned from his post shortly after the Napster announcement, sending a none-too-subtle signal to the music industry. But the major labels were allegedly peeved that CEO Thomas Middelhoff decided not to consult or warn them about the forthcoming Napster alliance (presumably an attempt by Betrelsmann to steal a march over its rivals in the media world). Nevertheless Bertelsmann is still forging ahead with efforts to sign up the other big record companies, efforts which will be crucial to Napster's success or failure. "We are currently talking to all the recording companies", said spokesman Frank Sarfeld. "The fact that Time Warner said one day after the announcement it was interested in joining,shows that they were not surprised." In a conference call yesterday, Thomas Middelhoff stated that three major record companies have expressed interest in joining the deal. While the labels' identities were not revealed, the keenest are believed to be EMI and Warner Music. Universal are taking an outside interest but it is thought that Sony are not yet involved in talks. Information on how exactly the new official Napster system will work is thin on the ground. Apparently Bertelsmann has agreed to drop its lawsuit when the current service closes; nevertheless, it is unlikely that 38 million freeloaders would willingly transfer to a paid-for model. comment on this article e-mail this to a friend start a discussion [about i-drive] writing index thoughts dotmusic index Problems? Questions? Suggestions? Contact me: mail@tobyslater.com back to top back to home page

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