CDnow signs three-year, $18.5 mil deal with Lycos

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Music retailer CDnow will become the exclusive music retailer of CDs and music-related products on Lycos and its subsidiary Tripod. CDnow will pay Lycos $18.5 million - $16.5 million in cash and $2 million in stock over the term of the agreement. In exchange, CDnow will be featured on Lycos' Shopping Network and Entertainment Web Guide, and will show up in music-related search results. Counting the CDnow deal, Lycos reported that it had signed $30 million worth of advertising agreements in the last month. Other distribution agreements include E-Loan, GetSmart, HomeShark, Preview Travel and

For Tripod, the deal sets up an affiliate program, in which Tripod members are encouraged to link to CDnow. If someone visits CDnow and buys merchandise via a Tripod member's page, the page owner will receive merchandise credit toward their next purchase on CDnow.

Copyright April 1998, Crain Communications Inc.

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