AOL to sell CDs and DVDs directly, ending the temporary link with Amazon.

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Monday, July 14, 2003

AOL to sell CDs and DVDs directly, ending the temporary link with Amazon.

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America Online said Friday that it is now selling DVDs and CDs directly as part of its push into digital music, ending a temporary link it had with Amazon.com Inc. until it was able to do so itself.

An AOL spokeswoman said the Internet division of AOL Time Warner Inc. had been using Amazon on an interim basis to sell CDs and DVDs. She added that its pacts with the online retailer are still ongoing.

The step to sell physical CDs and DVDs is part of AOL's efforts to get a bigger share of the digital music pie as it seeks out new sources of revenue to help in the online unit's turnaround and offset the shrinkage in its dial-up Internet service and the slump in ad spending from the dot.com heyday.

Online music has been one of the company's many efforts to keep and grow its Internet subscriber base, which totals more than 26 million in the United States.

The company plans to build on its music offerings, which now include online music subscription service MusicNet, with a digital music store that will let users burn as many songs to CDs as they want on an additional fee or a la carte basis.