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AOL Time Warner, Bertelsmann, EMI and Realnetworks create new platform for online music subscription services

New York (ots)

New venture, MusicNet, to offer consumers extensive collection of
secure downloadable and streaming music
Realnetworks and america online each to launch consumer
subscription services powered by MusicNet
AOL Time Warner Inc., Bertelsmann AG, EMI Group plc, and
RealNetworks, Inc. today announced a venture which will create a
breakthrough platform for online music subscription services. This
platform - MusicNet - will combine an extensive collection of
downloadable and streaming music with advanced technology. The end
result will greatly accelerate the roll-out of online music
subscription services for consumers across multiple distribution
networks, including RealNetworks and the America Online family of
interactive brands later this year.
Under the agreement, EMI, Bertelsmann, and AOL Time Warner will
each own a minority stake in MusicNet. The companies' music
subsidiaries - EMI Recorded Music, BMG Entertainment, and Warner
Music Group - will each separately license their music to MusicNet on
a non-exclusive basis. RealNetworks will also own a minority stake in
MusicNet and will contribute its industry-leading Internet media
delivery technology. MusicNet will operate as a standalone
independent company.
MusicNet, as both a technology provider and a music clearinghouse,
will license its "private-label" platform to companies seeking to
sell music subscription services under their own brands. The
company's goal is to distribute music profitably to as many outlets
as possible. MusicNet will initially license its platform to America
Online and RealNetworks, each of which plans to launch branded online
subscription services later this year. MusicNet will also license its
platform to other distribution outlets, including Napster, provided
such outlets satisfy legal, copyright and security concerns.
This marks the first time a majority of the major record companies
has licensed music to a venture whose goal is mass subscription
distribution over the Internet. MusicNet will offer distributors an
extensive collection of popular music content over one platform, and
will benefit recording artists by providing new opportunities to
reach fans and other consumers with their music in a secure and
protected fashion.
The depth of the music companies' catalogues will enable the
MusicNet platform to feature a rich array of music across all genres.
The artist rosters of the companies participating in MusicNet
include: Christina Aguilera, Bjork, Brandy, The Corrs, Eric Clapton,
Dandy Warhols, D'Angelo, Everclear, Ben Harper, Faith Hill, Whitney
Houston, Madonna, matchbox twenty, Dave Matthews, Brad Paisley, Red
Hot Chili Peppers, Carlos Santana, Vitamin C, and Robbie Williams, in
addition to leading classical, jazz, opera and world-music releases.
MusicNet will also seek to license music from other record
companies - major record labels as well as independents - in order to
provide consumers with the widest possible diversity of music. The
content licenses to MusicNet from EMI Recorded Music, Warner Music
Group, and BMG Entertainment are non-exclusive and each company
intends to continue to offer their music to other online subscription
and other platforms in the future. In addition, the licensing
agreement between America Online and MusicNet is non-exclusive, and
America Online plans to provide its members with additional
subscription services along with other online music offerings.
The MusicNet platform will, for the first time ever, unite a
majority of the major record labels behind a single digital
distribution technology, providing affiliates with ready-to-sell
subscription offerings. MusicNet takes advantage of the unmatched
scalability, reliability and security of RealSystem iQ, and it
supports the broadest range of media formats.
Rob Glaser, Chairman and interim CEO of MusicNet, and also the
Chairman and CEO of RealNetworks, said: "The launch of MusicNet will
catalyze an exciting new era in digital music distribution. MusicNet
will offer consumers an easy, simple way to get the highest-quality
music while also protecting the intellectual property of record
companies and artists. This marriage of great technology, incredible
content, and worldwide reach is going to be music to a lot of
people's ears. Looking ahead, we hope that all the major and
independent labels will join MusicNet to create one-stop music
subscription offerings with unbeatable consumer momentum. We look
forward to working with the entire industry to make music
subscription services a reality."
EMI Group Chairman Eric Nicoli said: "We are dedicated to giving
fans the greatest possible access to our artists' music. In pursuit
of that mission, throughout our history, we have been keen to embrace
new technologies. New media opportunities abound and we are
especially excited by those which provide fast, easy and legal
distribution of music. This MusicNet alliance fulfils those criteria
and represents a major step forward for EMI and our partners in this
compelling new venture."
Bertelsmann Chairman and CEO Thomas Middelhoff said: "We are
committed to making online distribution platforms such as MusicNet a
significant part of our business. As the first company to address
important issues surrounding media distribution, such as peer-to-peer
file-sharing, Bertelsmann is the leader in charting a course for the
future of digital distribution. We give consumers the content they
want, how and when they want it, through accessible and easy-to-use
technology of which MusicNet will play a leading role."
AOL Time Warner Co-Chief Operating Officer Dick Parsons said:
"This agreement ushers in the era of secure, convenient, interactive
mass music distribution. It will transform how consumers discover and
experience music in their everyday lives, and is an important step in
our strategy to use the Internet to give music consumers
significantly more choice, convenience and flexibility. By licensing
the Warner Music catalogue to MusicNet, we create new outlets for our
artists and their work, and by distributing a MusicNet-powered
subscription service on AOL as part of AOL's overall music strategy,
we advance our goal of creating the best interactive music experience
for our online members. AOL Time Warner is developing numerous
innovative ways for fans to discover, experience and own music across
our various properties, and our relationship with MusicNet will be a
part of this effort."
About The Partners
RealNetworks, Inc. (NASDAQ: RNWK) is the global leader in Internet
media delivery. It develops and markets software products and
services designed to enable users of personal computers and consumer
electronic devices to send and receive audio, video, games and other
multimedia services using the Web. Consumers can access and
experience audio/video programming and download RealNetworks consumer
software on the Internet at http://www.real.com. RealNetworks'
systems and corporate information is located on the Internet at
http://www.realnetworks.com .
EMI Recorded Music, the third-largest record company in the world,
is an international music company with a presence in nearly 70
countries. Its sister company, EMI Music Publishing, is the world's
largest music publisher. EMI Recorded Music includes important local
and international artists, including some of the biggest names in the
recorded music industry. EMI has artists in every leading music
genre, including pop, rock, jazz, classical, Latin, Christian,
country, rap/urban and dance. The world-famous labels include
Capitol, Angel, Blue Note, EMI, Priority and Virgin. Its current
roster includes approximately 1,500 artists, and it releases over
1,000 albums each year. AOL Time Warner Inc. (NYSE: AOL) is the
world's first Internet-powered media and communications company,
whose industry-leading businesses include interactive services, cable
systems, publishing, music, cable networks and filmed entertainment.
Bertelsmann AG (www.bertelsmann.com) is the world's most
international media company. Bertelsmann commands leading positions
in the global media and entertainment industries. The Bertelsmann
Group consists of publishing and music companies, book and music
clubs, magazines and newspapers, television and radio stations, print
and media service providers, multimedia and professional information
companies represented by such brands as Random House, BMG, Gruner +
Jahr and RTL. Bertelsmann is the world's largest general-interest
publisher and the biggest English-language publishing house
worldwide. Bertelsmann book and music clubs are number one worldwide
with 41 million members. Through RTL Group and Gruner + Jahr, the
company ranks first in the European broadcasting and magazine
sectors, respectively. Bertelsmann is the worldwide leading media
company in the internet, and top ranking in its peer market in
e-commerce with BOL in Europe and barnesandnoble.com in the US. The
organization currently employs 81,000 people in 58 countries and
posted 16.5 billion Euro in total revenues in the 1999/2000 financial
year ended June 30, 2000.
For further questions, please contact:
Bertelsmann AG
Oliver Herrgesell
Media and Financial Relations
Tel.: +49 - 52 41 - 80 24 66
Fax:  +49 / 52 41 / 80 - 66 13 
oliver.herrgesell@bertelsmann.de

Original content of: Bertelsmann SE & Co. KGaA, transmitted by news aktuell