Online music trading service Napster said Friday it will sack 10 percent of its staff as it awaits a deal with the world's leading record companies.
Napster has been all but shutdown since last summer, the result of legal battles with the so-called "Big Five" of the record industry: Sony Music Entertainment, Universal Music Group, BMG Entertainment and Warner Music Group.
That closure was the result of a court finding that the Web site allowed its 70 million-plus users to engage in copyright infringement by swapping digital music files over the Napster network.
Napster has been trying to strike a deal with those companies to distribute their vast catalogs over the Internet legally. But the record companies are balking at such a deal, especially after launching their own online music distribution sites.
"In order to see this through the long haul, we needed to make moderate and temporary staffing reductions, which resulted in a 10 percent cut," Napster CEO Konrad Hilbers said. "In the interim, we're continuing our development efforts on the new service."
News source: The Nando Times - Napster cuts 10 percent of staff