Just when it appeared Napster had one foot in the grave, the beleaguered file-sharing service has received a new lease on life.
Three days ago founder Shawn Fanning and CEO Konrad Hilbers, among other top execs, announced their resignations after the company's acquisition deal with media conglomerate Bertelsmann went belly-up. But thanks to an $8 million deal worked out Friday (May 17), Fanning, Hilbers and four other previously resigned executives will remain with Napster, according to spokespeople for the two companies.
Napster's price tag was drastically reduced from what reportedly was on the table Monday $16.5 million, according to the Los Angeles Times (see "Napster On The Brink Of Disaster"). Bertelsmann will now make less than half that amount available to Napster's creditors by purchasing its assets.
"We are very pleased to have reached an agreement with Napster's board of directors," Bertelsmann CEO Joel Klein said in a statement. "We're happy to see Napster move forward with Konrad Hilbers at the helm. We are very committed to providing artists the best possible distribution opportunities for their work and to providing consumers more choice and control. ... Peer to peer is a transforming technology, and we're proud to have Shawn Fanning continue to work on its development."
"Bertelsmann understood our vision when they first invested in us," Fanning said in the joint statement. "They still believe in that vision. I'm ready to work with the many talented people at Napster to complete the new service and get it off the ground."
For a feature interview with Shawn Fanning, check out "Napster: Shawn Fanning Speaks."