MP3.com, EMusic and Others Merge.

By Robert Menta- 11/19/01

Vivendi Universal announced in a press release today that it is consolidating its Web properties into a single entity to be called Vivendi Universal Net USA Group. The new division will report to the company's Paris-based Internet division Vivendi Universal Net and includes; MP3.com, EMusic.com, Get Music.com, RollingStone.com, InsideSessions.com, and several game, education, and entertainment sites.


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MP3.com CEO Robin D. Richards has been tapped to lead the new group and will report directly to Philippe Germond, CEO of Vivendi Universal Net. The new company will be based in Los Angeles.

While it is easy to just call this a corporate restructuring, the purpose of the new group is to centralize the technologies developed by Vivendi Universal's recent Net acquisitions, particularly those from its Online music group. This is important as the company tries to figure out how best to profit from Net music and video in an environment where Napster clones champion the delivery of such online content for free. As a seasoned veteran of digital music delivery, Richards was a logical choice to helm the US focused group (though another potential choice, EMusic's Gene Hoffman, is the only executive who's main business focus was to sell music on the Net. He now reports to Richards).

"I am very excited about the prospects that this new company will create for Vivendi Universal and all of its business units", said Richards. "Through the formation of Vivendi Universal Net USA, we'll be able to offer a centralized technological infrastructure for our various content businesses - music, film, games and education - and to create new and lasting one-on-one relationships with our customers".

Despite the consolidation, Vivendi Universal still has to contend with other issues in the mecurial Net music arena. This includes not only the rise of the Napster clones and several pending lawsuits against MP3.com, but the investigation of its own upcoming Net music service PressPlay, which is under scrutiny in both the US and Europe for possible antitrust violations. The road to profitability for the company's endeavors is both elusive and long-term, demanding considerable resources Vivendi Universal has and, for now, seems willing to spend.

Other sites blended into the new group include; Uproar, Flipside, iWin.com, Education.com, casino site VirtualVegas.com, and the upcoming MP4.com video site.

 

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