Facing the Music - case of the Recording Industry Association of America vs. Napster Inc - Statistical Data Included

Current Events, March 16, 2001

Napster's Fight to Stay Online

San Francisco -- Most people wouldn't walk into a music store and steal armloads of CDs. But millions of people have downloaded free tunes with the help of Napster, a popular Internet site that allows users to swap computer files of recorded music at no charge. Is that stealing?

A federal appeals court here thinks so. On February 12, a three-judge panel of the Ninth U.S. Circuit Court of Appeals upheld a lower court's ruling that Napster "knowingly encourages and assists" its users in violating U.S. copyright law. Copyright law makes it illegal to copy without permission "works of authorship," such as recordings, writings, and drawings.

The decision was music to the ears of the Recording Industry Association of America (RIAA), a trade group that brought suit against Napster in December 1999 on behalf of five major record labels. Napster, however, is singing a different tune. On February 20, Napster offered to pay record companies a $1 billion settlement over five years for the right to use their music in a new fee-based song-swapping Internet service. If its offer is rejected, Napster said it will ask all the ninth circuit judges to reconsider the panel's decision. And if necessary, Napster plans to appeal the ruling to the U.S. Supreme Court. In the meantime, the lower court judge, Marilyn H. Patel, is rewriting her injunction, which is an order requiring someone to stop doing something, that could shut the site down during the legal wrangle.

Stop the Music!

Since Napster was founded in May 1999, more than 64 million people have shared songs on the site free of charge--which means there have been no royalties, or payments based on sales, for artists or profits for record companies from the song swaps, users downloaded more than 3 billion copies of songs in January alone. In the weekend after the three judges' decision against Napster, frenzied fans of the site made 250 million copies of songs, fearing Napster's imminent shutdown.

The February 12 ruling estimates that more than 87 percent of the music traded on Napster is copyrighted, much of it by the record companies suing the site.

"The court's decision is a victory for all creators," said RIAA president Hilary Rosen. "To say that taking music without compensation is not stealing is to suggest that music has no value," added Rosen.

Many musicians agree. Rapper Dr. Dre and heavy metal band Metallica filed their own suit against Napster last April. Metallica insists that recording artists must be "able to control how, when, and in what form their creativity is distributed."

Jerry Rosen, a violinist who earns much of his income from royalties, is bewildered by what he sees as Napster fans' sense that they are entitled to free music just because it is available on the Internet. "There's a sense among young people that [using Napster] is their God-given right."

Save the Music!

Nineteen-year-old Shawn Fanning developed Napster to make it easier to find digital music files on the Internet. Napster claims it isn't in violation of copyright law because it doesn't actually copy music or store songs itself. Instead, Napster software searches the computers of a network of users who have uploaded music files and helps people find the songs they're looking for. Napster said its users "share" songs and that no money is exchanged among users.

Napster also argues that it should be protected by the 1992 Home Audio Recording Act, which allows people to record music or videotape movies so long as it's for their personal, not commercial, use. That right should be extended to using personal computers, say Napster attorneys.

Napster users claim the site wouldn't be so popular if CDs weren't so expensive. "I get really angry when I hear [the recording industry] complaining about Napster, because they've aided and abetted this whole process by jacking up CD prices," said music store owner Chris Zingg.

Not all musicians are anti-Napster. Rapper Chuck D. thinks recording artists should welcome Napster. "We should think of it as a new kind of radio-promotional tool," he said. Fred Durst of Limp Bizkit said his band plans to participate in concerts to generate support for Napster.

Gene Kan, who developed Gnutella, a site similar to Napster, says the recording industry has itself to blame for the popularity of song-swapping on the Internet. "The music industry hasn't come forward with its own version of Napster to allow people to swap files online, which is something people obviously want to do."

BACKGROUND

Shawn Fanning was an 18-year-old student at Northeastern University in Boston when he put together a computer program that allowed users to search each other's hard drives for digital music files, also known as MP3 files. Using his childhood nickname, Napster (earned for his hairstyle), Fanning logged onto online chat rooms asking for feedback on his program. On June 1, 1999, he gave the program to 30 of his chat buddies in confidence. His friends like the program so much that they couldn't keep quiet about it and sent it to many of their friends. In a few days, about 10,000 to 15,000 people had downloaded the program. About a year later, more than 25 million people had registered to use the service, making Napster the most popular piece of software to ever hit the Web. Napster is a peer-to-peer file transfer, which means no files are transferred through Napster servers. The program does not make copies of CDs or create MP3 files from original CDs.