Music giant Bertelsmann has announced plans to acquire music sharing service Napster in a deal worth US$8 million. The deal appears to keep Napster founder (and CTO) Shawn Fanning and CEO Konrad Hilbers associated with the service.
Under the terms of the agreement, Bertelsmann will pay the US$8 million to creditors of Napster in an effort to acquire Napster's assets. This latest move caps "a very unusual week," in Hilbers' words, who actually announced plans to resign earlier this week after Napster's Board of Directors rejected Bertelsmann's offer. Apparently the Board had a last-minute change of heart.
Bertelsmann, Inc. chairman and CEO Joel Klein said his company is pleased to have reached an agreement with Napster's Board of Directors, and they're happy to see Hilbers remain in charge. Klein indicated that Bertelsmann will continue to find a successful business model for Napster, which was virtually shut down by court order in a legal standoff with representatives of the recording industry last year.
"We are very committed to providing artists the best possible distribution opportunities for their work, and to providing consumers more choice and control," said Klein. "Creating new ways of doing business is never easy, but Napster will be at the forefront of finding business models that respect copyright, reward artists, and deliver entertainment value to consumers. Peer to peer is a transforming technology and we're proud to have Shawn Fanning continue to work on its development."
Hilbers will chair Napster's board of directors. Executives rejoining Napster's management team include Jonathan Schwartz, General Counsel, Claire Hough, VP of Engineering, David Phillips, VP of Napster Services and Product Management and Oliver Schusser, VP of Marketing. Continuing with the company will be Manus Cooney, VP of Corporate and Policy Development and Lyn Jensen, CFO.
This story, "Bertelsmann buys Napster for $8 million" was originally published by PCWorld.