Sony/BMG demotes CEO over rootkit and payola scandals

Sony BMG CEO Andrew Lack has been "demoted" to chairman and Rolf Schmidt-Holtz has been promoted to replace him, due to a number of scandals including the rookit copy-protection problem, radio station "payola" and "spiraling fees paid to artists."

Following the change, Schmidt-Holtz will assume overall management responsibility, while Lack "will lead the company's public policy and industry initiatives, and assume operating responsibility and oversight for the theatrical film business of Sony BMG," a joint statement said.

The company operates several labels, including Columbia, RCA, J Records, Jive and Music with a Twist and includes a roster with Anti-Flag, Foo Fighters, Say Anything, Franz Ferdinand, the Ataris, Midtown, the Blood Brothers, A Static Lullaby, Acceptance, and Ben Kweller among others.