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By Jon Bernstein, 29 July 2002 07:23

NEWS Thomas Middelhoff, one of Europe's leading media players, quit his job last night after a major row over the future direction of his company. Middelhoff will be replaced as chief executive of Bertelsmann by Gunter Thielen and some German newspapers have already matched Middelhoff with the vacant job at Deutsche Telekom. The row is understood to have been over corporate strategy. Middelhoff is thought to have wanted to take the privately held firm onto the stock market, a move existing shareholders oppose. Middelhoff, 49, had been in charge at Bertelsmann since 1998. He was quick to embrace the internet age tying up a deal with AOL, effectively becoming the US portal giant's European arm. When AOL announced its multibillion-dollar merger with Time Warner at the beginning of 2000, Middelhoff was equally quick to negotiate a lucrative exit from the deal. Later that year, in more controversial style, Middelhoff sanctioned a deal with Napster at a time when all the big music labels were in legal dispute with the renegade file-sharing site.
Bertelsmann's media interests in the UK include a 65 per cent stake in Channel 5 via its control of the RTL Group. Speculation over the top job at Deutsche Telekom will inevitably increase in coming weeks. Ron Sommer stepped down as chief executive earlier this month and Middelhoff certainly has the international experience to put him on the short-list.