Seagram, AOL Plan Net-Based Record Label

Universal Music Group is teaming with America Online Inc. and others to launch a new Internet-based record label.

The initiative, to be called Jimmy and Doug’s Farm Club, will be headed by Universal Music Chairman Doug Morris and Jimmy Iovine, co-chairman and Seagram’s Interscope Geffen A&M label. America Online (AOL) will own 3 percent of the new operation and Seagram (VO) the remaining 97 percent.

Visitors to FarmClub.com will be able to vote on favorite acts who will be featured on a new, hour-long TV show to be featured on Seagram’s USA Network. The Farm Club venture will offer access to all varieties of music with a special emphasis on music of interest to young adults.

Coca-Cola Co.’s (KO) Sprite will be the main sponsor.

The new label will the latest in a series of shake-ups in the music industry caused by the Internet. It marks the first major step taken by a recognized label to use technology to bring new artists to the forefront. MP3, the dominant online music format, has long been used by a variety of independent artists who wish to take their music directly to listeners.