Cox Interactive Media Inc. (CIMedia), a unit of privately-held Cox Enterprises Inc., said yesterday it will invest US$45 million in MP3.com Inc., a fast-rising distributor of music over the Internet.
As part of the deal, the two partners will set up a 50-50 joint venture that will build music-related Web sites. Cox Enterprises will appoint one board member. Other details of the agreement were not released.
MP3.com enables users to download music from its Web site for a fee. The site offers music from mostly independent artists that span a range of genres from country to rock.
The deal shows how Internet music distribution is expanding from its grass roots origins and attracting large media and technology players. Set up in November 1997, MP3.com this year received $10 million in venture funding and announced plans to go public.
IBM Corp. and a group of large record labels later this year will test a system for selling music over the Internet. Several labels, including Sony Music Entertainment, are considering ways to tap potentially huge revenues selling music over the 'Net without cannibalizing their lucrative music CD sales.
Cox Enterprises is an Atlanta, Georgia-based media company that owns a fleet of newspapers, television broadcasters and radio stations. The company is also the parent of Cox Communications Inc., a cable operator.
MP3.com Web at www.mp3.com
Cox is at www.cimedia.com