Bertelsmann eCommerce Group

BeCG licenses Napster's technology platform for global music services company BeMusic
BeMusic using Napster's new secure technology to focus on eCommerce, subscription services and club membership business

New York, NY and Redwood City, CA (ots) - Bertelsmann eCommerce Group (BeCG) announced today the completion of a technology licensing and distribution agreement with Napster Inc. The agreement calls for Napster's new secure technology, absent Napster's peer-to-peer functionality, to be used as a core building block for BeMusic. It will also give Napster's platform added distribution through the new BeMusic service. With over 23 million subscribers and customers, BeMusic's online and offline music and entertainment service consists of CDNOW, the leading Internet-based music retailer; BMG Direct, home of BMG Music Service, the largest record club business in North America; and myplay Inc., the pioneering digital music locker company. "Napster's platform has been tested by millions of music fans and the Napster technology is trusted as dependable and easy to use," said Andreas Schmidt, President and CEO of BeCG. "The new secure version of the technology has incorporated feedback from the Napster community as well as the rightsholders. BeMusic will use this platform to build an easy-to-use, new service that offers the best in e-commerce, subscription services and club memberships, driving future sales and encouraging the adoption of secure digital music delivery." "Napster is pleased that BeCG has licensed Napster's technology for their BeMusic service and we look forward to the added distribution this partnership affords us," said Konrad Hilbers, CEO of Napster Inc. "We have worked hard to incorporate feedback from Napster users to create a new Napster platform that reflects our goal to serve both consumers and rightsholders. We are also very gratified to see the results of the Napster team's hard work becoming the basis for other consumer services and moving out into the world. We look forward to showcasing this new platform in our upcoming membership based service." The new secure version of the Napster platform licensed by BeCG reflects Napster's knowledge of the music consumer. Using Napster's technology, BeMusic's subscribers will have access to a service with the greatest ease-of-use of any available on the market while protecting rightsholder's copyrights with state-of-the-art security technology. The underlying architecture, which does not include Napster's peer-to-peer functionality, will be used as a platform on which the BeMusic suite of brands and services will be built. BeMusic's 23 million subscribers and customers will benefit from Napster's platform in creating a robust service that encompasses new features such as instant messaging, hot lists, chat features, search functionality and playlist and music library retrieval capabilities; all of which can be dynamically presented based on personal user preferences. These features will be integrated into BeMusic's offerings that include direct download, streaming, digital locker services, club memberships, subscription services and online retail. About BeMusic BeMusic is the world's largest music services group with more than 23 million subscribers and customers, $1 billion in music sales, and has 11 million unique visitors per month worldwide. Headquartered in New York City, BeMusic operates some of the world's best-known music brands, including BMG Music Service, the world's largest music club; CDNOW, the leading music retailer on the Internet in the U.S; industry-leading technology and Digital Rights Management companies; and myplay Inc., the pioneering digital music locker service. BeMusic is focused on creating the one-stop shop for today's and tomorrow's consumer, covering the complete spectrum of how people buy and enjoy music. BeMusic delivers music through any possible channel, including music club purchasing, e-tailing, digital downloads and streaming, and digital subscriptions services. Formed in July 2001, BeMusic also holds a strategic alliance with Napster, the worldwide person-to-person music file-sharing service with more than 60 million registered users. About BeCG Bertelsmann eCommerce Group was formed in July 2000 as a division of Bertelsmann AG. The objective of the group is to integrate all forms of digital and physical distribution over the internet, broadband and mobile networks for all media content. Headquartered in New York, BeCG operates various businesses in Europe and the United States. BeCG is part of Direct Group Bertelsmann. Bertelsmann has access to over 200 million customers worldwide. About Napster Founded in May 1999, Napster, Inc. pioneered person-to-person file sharing and created one of the most frequently downloaded software applications in the history of the Internet. Napster provides music enthusiasts with an easy-to-use, high quality service for discovering new music and communicating their interests with other members of the Napster community. The service enables users to locate and share music files, send instant messages to other users, and create Hot List bookmarks. In October 2000, Napster partnered with Bertelsmann eCommerce Group to develop a membership-based service. Edel Music and TVT Records joined the alliance in January 2001. In June 2001, Napster became a MusicNet partner and signed a landmark distribution deal with the Association of Independent Music (AIM) and the Independent Music Companies Association (IMPALA), two organizations that represent hundreds of European independent record labels. In September, 2001, Napster signed a landmark accord with the National Music Publishers Association (NMPA) for a proposed licensing and settlement agreement. ots Original Text Service: Bertelsmann eCommerce Group Internet: www.newsaktuell.ch Contact: For BeMusic/BeCG: Alexander Adler Director, Corporate Communications Fon: +49 (40) 822262 320 Alexander.Adler@becg.com For Napster: mPRm Public Relations Paul Breton / Karen DeMarco Fon: +1 (323) 9333399 pbreton@mprm.com / kdemarco@mprm.com

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