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Bertelsmann Gives BeMusic Management Facelift

BeMusic, the world’s largest music services group owned by Germany’s Bertelsmann, unveiled a new structure and management team on Tuesday that will oversee the group’s joint venture with Napster.

Bertelsmann’s eCommerce arm, which agreed an alliance last year to help build a legitimate version of online rebel Napster, said its Chief Executive Officer Andreas Schmidt would take the top post at BeMusic, home to the world’s largest music club and online CD retailer.

Bertelsmann is developing BeMusic as a one-stop music shop, bringing together its online music store CDNow, music club division BMG Direct, recently acquired online song-storage company Myplay Inc and its alliance with Napster.

Napster plans to launch a subscription service this summer with the backing of Bertelsmann funds and technical know-how. Its original free music-sharing site has steadily ground to a halt as it complies with a court order to protect copyrighted material.

Formed earlier this month to bring 23 million subscribers and customers under the umbrella of Bertelsmann’s eCommerce group, BeMusic will be split into three divisions: BeMusic Direct, BeMusic Services and BeMusic Digital.

“It’s important we get this right as music is key in digital delivery and will lay the ground for other digital models,” Schmidt said.

The chief executive of Bertelsmann’s online retail arm bol.com, Stuart Goldfarb, will head up BeMusic Direct, while Tom Hoekzema, senior vice president of operations for BMG Direct, will lead the BeMusic Services division.

Schmidt, who maintains his role as head of Bertelsmann’s eCommerce group, will run BeMusic Digital until a chief executive can be found.

In the shake-up, George McMillan, the current CEO of BMG Direct, is leaving the company to become chief financial officer of U.S. Internet operator CMGI Inc.

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