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E! Online columnist Marc Malkin said the network is unhappy with Cyrus, 15, after her recent topless photoshoot for Vanity Fair caused outrage in the US.
He claimed executives are now keen to promote the career of actress/singer Selena Gomez, who starred as a rival popstar in Cyrus's TV show Hannah Montana.
Gomez, also 15, is currently starring as Alex Russo on the Disney Channel series Wizards of Waverly Place.
Malkin wrote: "I'm told Disney executives are so worried about Cyrus's recent controversies that, more than ever, they want to make Gomez an even bigger star."
He quotes a source as saying: "Selena sings and acts and is really young. She is going to be the next Miley Cyrus. [Disney executives] really want this."
