Thanks Tony Phang. With the resignation of Thomas Middelhoff as chief executive of Bertelsmann AG, the future looks even bleaker for the debt-riddled and lawsuit-plagued music file swapping company, experts said on Monday.
"This can"t bode well for Napster," said Peter Fader, a professor of marketing at the Wharton School at the University of Pennsylvania. "It"s hard to see a scenario where Middelhoff goes but Napster stays."
Fader attributes the shake-up to "dot-com backlash" as Bertelsmann and other media companies tire of throwing money at unprofitable Internet companies.
"It"s a shame to throw the baby out with the bath water and that"s exactly what might be happening here," he said.
"People are either running scared or being pushed out," said one employee of an online music company who asked not to be named. "With respect to Napster, it could be the final nail in their coffin."