• The New York Times, Monday, March 17, 2008 11:30 AM

When Starbucks began selling the CDs of undiscovered artists in 1990s, it was betting that its eclectic taste played to the upscale atmosphere of its coffee shops. And record companies saw Starbucks at the vanguard of a new class of unconventional sales outlets for CDs. But critics say the company squandered its cachet by mismanaging the effort to broaden its music mix.

The choices that reflect Starbucks early taste for the offbeat--like an album from Lizz Wright, a torchy pop singer--are now squeezed in with offerings not unlike those at Wal-Mart, including the latest releases from Alicia Keys and James Blunt. Its sliding reputation in the music business represents a setback in its efforts to build cultural credibility, which have also included promotion of a handful of films, books and an in-house magazine called Joe.

Along the way, Starbucks has alienated business partners who contend that it has demanded too big a cut of music revenue. The company's shift in direction has also prompted upheaval within--including the departures of half a dozen senior executives from its entertainment unit.

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