In its latest move toward a completely free, ad-based model, AOL has sold its Music Now unit to rival Napster.
The terms of the agreement include Napster's adding Music Now's 350,000 subscribers to its own, with AOL's advertising Napster on its services while getting a percentage of each resulting subscriber, AdWeek reports. Napster's number of subscribers will total just over 900,000 as a result of the deal.
AOL purchased Music Now from retailer Circuit City two years ago. The number of subscribers reached 450,000 by the middle of 2006 - but fell to 350,000 because AOL stopped marketing the service as it began to migrate toward a free model.
The move will likely help Napster, which has spent the last few months investigating ways to make it more attractive to buyers.
