AfterDawn: Tech news

Napster gets more funding from Bertelsmann

Written by Petteri Pyyny (Google+) @ 26 Oct 2001 15:56

Bertelsmann confirmed today that it has given another round of funding for Napster -- the amount was unspecified, but industry sources say it was very likely around $26 million. Also, according to analysts, Bertelsmann gave the extra funding for Napster because company has cut its cash-burn rate by laying off people in this week and also by licensing its legal distribution platform for Bertelsmann's online music company BeMusic, also in this week.
Bertelsmann was the one of the five music industry giants that stepped down in its fight against Napster in last year and instead started funding Napster in order to transform it into a legal subscription-based online music business. Napster's controversial P2P service has been shut down since July and company expects to launch its "legal Napster" by end of this year.

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