The Napster Challenge

Insight on the News, Jan 15, 2001 by Catherine Edwards

Napster, led by a teen-age whiz kid, has unleashed a revolution in the music industry with its MP3 file-sharing technology, as record companies promote a new style of pop idol to youth.

A little computer program called Napster revolutionized the music industry last year and things don't look too different for 2001.

One year ago, 19-year-old Shawn Fanning was a freshman computer geek at Northeastern University in Boston. Now he is the very famous chief executive officer of Napster, the program that allows computer users to download music from other music-lovers' computers via the Internet for free -- without going through a third-party provider.

Fanning wrote the program in his dormitory room and gave Napster the nickname he got as a kid from his bad haircuts. He had noticed that his roommates were downloading music from the World Wide Web using MP3 technology, which is the computer software that shrinks music and video files for easier Web transmission. He thought there could be a way music fans could share those music files over the Internet and went about writing the software to do just that. In September 1999, Napster went online and was an instant hit. Fanning got $15 million in seed money to start his corporation and has not looked back. The recording industry hates Napster because it bypasses its income stream. Instead of the music lover taping songs off an audio source, now music files fly around in cyberspace and fans can download files and "burn" a perfect compact disc of all their favorite hits. Because of the stunning success of Napster, Fanning was sued last year by his favorite band, Metallica, as well as rapper Dr. Dre. "As an artist there are so many ways that we can be taken advantage of," says Dr. Dre. "To have yet one more way to strip an artist of making an honest living is just too much. That's why I sued."

But teen-agers love Napster and, despite lawsuits, the recording industry is sure to be in a battle with America's teens in 2001. Record companies need teen-agers' business and they market products directly to them. But instead of buying CDs last year, 38 million cash-strapped fans switched their allegiance to Napster, at least on a casual basis, which has an estimated base of 900,000 hard-core users. And kids with tech savvy, which is nearly all of them, will figure out how to get the latest songs from Britney Spears and the Backstreet Boys for free regardless of whether Napster loses its legal battles in 2001.

The Recording Industry Association of America (RIAA) sued as well, claiming Napster infringed on record labels' copyrights. A California judge ordered Napster to shut down, but the order was stayed and Napster's case is on appeal. German music giant Bertelsmann AG, the owner of BMG Entertainment, decided it couldn't beat Napster so it joined them by striking a $50 million deal with the company in exchange for a new fee-based system for distributing BMG's music online.

Along with the nation's teen-agers, Senate Judiciary Committee Chairman Orrin Hatch of Utah is an unlikely proponent of the online music company. A key Hatch aide recently left Capitol Hill to become Napster's chief lobbyist in Washington. Unbeknownst to many, Hatch is a prolific, yet frustrated, songwriter who says Napster is a great way to get your music known if you don't get a record deal.

"For every Metallica, there are thousands of talented songwriters whose music will never be recorded, talented musicians whose work will never be heard by the public. Peer-to-peer technology (like Napster) may help some of these artists" Hatch said in an interview with Inside magazine.

The music-sharing technology does not censor lyrics or warn of their content. In record stores, CDs with violent lyrics are labeled with warnings. The Internet allows all music, regardless of content, to come into the computer in the family living room. Record companies that have admitted to marketing violent lyrics to teens don't show signs of backing off in 2001. The most famous peddler of violent lyrics in 2000 was 26-year-old Marshall Mathers, known to his fans as Eminem, who became the best-known white rapper last year since Vanilla Ice in the late eighties.

Eminem's name has nothing to do with the candy, however. It's taken from his initials: M.M.

Married to his high-school sweetheart, Kim, and a proud father, Eminem almost was divorced by his wife because of her horror at being featured as a murder victim in one of his songs. They reconciled just before Christmas, when he faced a little legal trouble, and his songs no doubt will continue to sell and offend in 2001.

In his hit song, "The Real Slim Shady," he sadistically makes fun of Will Smith, the young pop-sensation Christina Aguilera and Limp Bizkit's Fred Durst.

In other tunes his sharp lyrics attack women, gays and Christians. But he still sells millions of records and says, boastfully, "Half the s*** I say I just make up to make you mad."

And he certainly has raised the ire of parents and the federal government. The music-recording industry found itself called on the carpet before Congress on more than one occasion last year and will be under scrutiny again in 2001. The same could be true of Napster next year.