Bertelsmann and myplay Become the Latest Newlyweds to Emerge from the Record Label-Internet Dating Game
It appears as though Internet-based music companies are taking an "if you
can't beat 'em, join 'em" approach with major music labels. The most recent
example of the attitude shift can be seen in Bertelsmann eCommerce
Group's (BeCG) $30 million acquisition of myplay, Inc. the pioneering music
locker service with more than six and one half million registered users.
By adding myplay as their newest building block, BeCG can incorporate myplay's Locker and Subscription technology into some of their other
properties, which means added services for consumers in the very near future.
Effective July 1st, BeCG will merge all of its online and offline music
assets into its newly founded BeMusic Division, which includes Bertelsmann's
CDNow and BMG Direct, to form what they predict will be the top global music
BeMusic serves over 12 million subscribers, part of 23 million customers
online and offline. It operates the world's largest music club and one of the
largest US online music retailer, in addition to technology
and DRM companies. BeMusic will continue
its strategic alliance with Napster, which focuses on building a
subscription-based filesharing service.
With myplay on board, BeMusic customers will be able to store and access
their music from any location via any device, whether PC-based, handheld, at
home or in the car through Internet, broadband or mobile networks. BeMusic
will work closely with the myplay team to integrate its Locker and
Subscription technologies into their wide-ranging brands so that consumers
can seamlessly store, manage, download or stream the music they care about.
BeCG can now cover all possible distribution technologies and platforms for
music fans everywhere, ranging form retailing online and offline,
subscriptions to downloads, filesharing and streaming music.
Bertelsmann executives hope the acquisition of myplay will build its
subscription services and if they succeed, the company should be commended
for its smart shopping skills. The company recently rejected a deal to
acquire MP3.com, the Internet company now owned by Vivendi Universal. Bertelsmann rejected the MP3.com
offering price of $350 million, deciding instead to pay less than one tenth
of that price for myplay, which offers similar services. Vivendi Universal
later picked up the San Diego, California-based company in a $372 million
myplay CEO Doug Camplejohn
commented on the arrangement. "We share BeCG's commitment to provide
consumers with the best digital music experience. From our launch
day in October 1999 we hoped to change the way people experienced music on
the Web. Now, as part of BeCG we will be able to realize that goal, bringing
our tools, team and technologies to join the company that is creating the
Web's best music distribution platform with the greatest flexibility and ease
of use for the consumer."
David Pakman, President of Business Development and Public Policy and
co-founder of My Play agrees. "As part of the BeCG multi-channel platform,
the My Play Locker can become the cornerstone of new subscription offerings
from a company clearly possessing the leadership and direct-to-consumer reach
to credibly deliver on the promise of digital music," he said with
enthusiasm. "With consumers clamoring for access to legitimate, convenient
online music services, we are pleased to become part of a company so
committed to innovation and the quality of the customer experience."
Now that the dust has settled from the Internet boom of 2000, music
technology companies are either merging with each other, or looking for a way
to exit the industry. Venture capital is harder to find this year, and some
companies have found it difficult to reasonably license music from major
labels and publishers, many of whom are developing subscription services of
In time, what consumers and Internet enthusiasts call "throwing in the
towel," or "selling out" to major record labels will hopefully lead to better
customer service and access to more music than ever before.
Bertelsmann AG - www.bertelsmann.com
CDNow - www.cdnow.com
MP3.com - www.MP3.com
myplay - www.myplay.com
Napster - www.napster.com
Vivendi Universal - www.vivendi.com
Yahoo - www.yahoo.com
Related MusicDish e-Journal Articles:
» Flycode: Another Napster Up for Sale (2001-05-30)
» Markets are funny. Ask MP3.com - Vivendi Universal Acquires MP3.com (2001-05-21)
Related News from Mi2N:
» Bertelsmann ECommerce Group Acquires My Play, Inc.