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Universal eyes BMG's GetMusic stake

The record label says it is in negotiations to acquire BMG Entertainment's stake in the companies' joint venture for online music.

Universal Music Group said Wednesday it is in negotiations to acquire BMG Entertainment's stake in the companies' joint venture for online music, GetMusic.

"We are in discussions with them to purchase the other half of GetMusic," said Bob Bernstein, a spokesman for Universal Music Group.

The negotiations underscore the different directions the two media giants are taking in their online music efforts. GetMusic is a popular music site geared toward teenagers that uses online video clips, photos and information about artists.

Bertelsmann, BMG's parent company, has placed its bets in online transactions, as seen in its investments in Napster, CD retailer CDNow, and Barnes&Noble.com. Universal Music's parent, Vivendi Universal, has focused less on selling content and more on distributing it through the Web and through cell phones.

"Their strategies on Internet have gone in different directions," said one person close to GetMusic. "It made sense that they could not continue in a joint venture."

On Wednesday, the separate directions became clearer when Bertelsmann Chief Executive Thomas Middelhoff resigned from Vivendi Universal's board of directors.

Sources close to GetMusic did not elaborate on the amount Universal Music is offering BMG for control of the company. BMG and GetMusic declined to comment on the negotiations.

BMG and Universal Music formed GetMusic in 1999 as a way for the companies to drive online CD sales and to promote their artists.