Sometime in the mid 1990s, a new way of collecting and listening to music was surfacing. Peer-to-peer networks allowed software to be traded back and forth, at no cost. The largest and most infamous of these file-sharing programs was Napster.
In 1998, a college student named Shawn Fanning pulled an all-nighter working on a new form of file sharing which he christened Napster. He imagined a huge community of music lovers, trading music back and forth in a virtual world. This was exactly what happened.
In 1999, Napster Inc was founded and established a facility in California. It was featured on Download.com Spotlight and instantly was world famous. The number of Napster users grew exponentially. A year later, in December of 2000, it had 20 million users. A vast majority of these were college students taking advantage of the blazingly fast Internet connection used on most college campuses.
Napster allowed unparalleled opportunities for file sharing, both in terms of availability and speed. Since there were such a large number of Napster users, the number of files available was higher still. Even if each user only had 20 files, there would still be four hundred million files available. But music libraries grew to dozens, hundreds, even thousands. It was the biggest repository for music or art in history. Its empire seemed invulnerable; its millions of users were eagerly awaiting a lifetime of Napster.
In the beginning, the mp3 craze was not fuelled by peer-to-peer programs like Napster. Instead, companies like mp3.com would keep the files directly on their central computer, and let users upload them from there. With the Napster network, the user is downloading directly from another user, and not going through Napster at all. The advantages of this for the users are twofold: users only have to download a file once, and then it is theirs (with sites like mp3.com it was necessary to go back every time and upload the song again); the sound quality was much better because they were not streaming the song, they were downloading it.
Of course, such heights could not last. The first band to complain was the heavy metal band Metallica. Metallica accused Napster of copyright infringement, since the band was not getting paid for any of their songs that were being traded on Napster. Napster challenged Metallica to identify users that were taking advantage of Napster to break the law. The band hired the British company NetPD to monitor Napster for traded Metallica files.
NetPD concluded that 335,435 Metallica files were traded in three days. Outraged, the band delivered the results to Napster headquarters - on paper. In 13 boxes, on thousands of sheets of paper, were printed every song found traded, by every user. As a result, Napster shut down over 300,000 of the accounts used to trade the songs. 20,000 people signed an oath saying that the music they downloaded was legal and were allowed to stay on as Napster members. But the ball was already in motion.
The next artist to follow was Dr Dre. Using the same company as Metallica, the rapper delivered the names to Napster in a computerized form, but had the same ultimatum: stop trading his music and compensate Dre for the money he might have received had his fans actually bought the music, not just downloaded it for free.
While Dre and Metallica were suing Napster, others were using it to boost their popularity. Limp Bizkit, another rock band, went on a Napster-sponsored free music tour just as Lars Ulrich, Metallica drummer, was testifying on behalf of his band.
Because of the way Napster works, with the files being downloaded from user to user, Napster claimed that they were not doing anything illegal because they were not the ones trading the copyrighted music, the users were. This, they reasoned, put them in the clear because of the Digital Millennium Copyright Act, the same law that protects VCR makers. But on 5 May, 2000, District Judge Marilyn Hall Patel ruled that Napster was not safe under this law, and what they were doing was, in effect, illegal.
On 31 October, 2000, Napster signed a deal with Bertelsmann Music Company to develop a membership version of Napster, where the company would be compensated in return for allowing Napster users to use their music. Napster must still protect other artist's rights, though, which means it must block every song not licensed by Bertelsmann. Napster tried offering a billion US dollars to the record companies if they dropped their suits. The companies scoffed at the low amount of money; they had already lost billions in stolen music.
The end came in February of 2001, when the court ordered Napster to stop trading all copyrighted material. Napster completely shut down while trying to negotiate with the record companies for a pay-based membership service, but as of April 2002 there has been no news.
The main loss of Napster's was not in money but in users. After the shutdown, all but a few hardcore fans drifted off to try other file sharing programs. In the wake of Napster, programs such as Morpheus, Aimster, Gnutella, Kazaa, and Smirk have felt the upsurge of new members. None, so far, has become as popular or as controversial as Napster was.
Record companies won only a temporary victory when Napster was shut down. Now, instead of just one peer-to-peer software to choose from, music lovers have dozens. The new age of digital music is just beginning; now, record companies just have to figure out how to deal with it.