Article 7 of 462
Napster may be
doomed, but music-swapping to thrive: analysts by Rob
WASHINGTON, March 7 (AFP) - The latest court ruling on
Napster could spell the end for one of the world's
fastest-growing websites, say analysts, but music delivery and
swapping on the Internet is here to stay.
Tuesday's injunction by a San Francisco federal judge bars
Napster from using its computers to transmit copyrighted songs
without permission, although all sides in the dispute it will
be complicated to do this because millions of users may change
file names as they swap songs over Napster.
Still, most analysts say the ruling will make it difficult
if not impossible for Napster to continue as a massive
supermarket for free music sharing.
"To a large extent, this is the beginning of the end for
Napster, at least for Napster as a nonsubscription service,"
said Nicholas Economides , a New York University
professor who follows the "new economy."
Analysts at Gartner Group, a California consulting firm,
said they do not see any legitimate business model coming from
Napster following Tuesday's injunction.
But analysts say the apparent victory for the music
industry may be short-lived if record labels and other
copyright holders fail to find a way to use the Internet for
The ruling forces the big five global recording labels "to
figure out an effective and reasonable digital music
distribution model," said P.J. McNealy, a Gartner analyst.
"This buys the big five labels time to get their catalogs
online and provides a legal alternative to the current illegal
file sharing system."
Napster chief executive Hank Barry said his company would
abide by the ruling while seeking to negotiate a settlement.
The recording industry so far has rejected a one billion
dollar offer from Napster, which is working with German media
giant Bertelsmann (owner of BMG music) to set up a
subscription service where fees can be used to pay royalties.
Bertelsmann eCommerce Group (BeCG) said that from its
perspective, the injunction did not change anything.
Bertelsmann will continue to "support all steps that lead
to the introduction of this new business model", a spokesman
But Economides said, "Napster would need more than
Bertelsmann to become the standard," adding that users are
already gravitating to other music-swapping sites.
Economides said the restrictions on Napster will
likely drive digital music fans to other systems that are free
and use no central server. Or, he said, music sites could set
up shop offshore where they would be less vulnerable to US law
"People will go the public domain programs like Gnutella or
Freenet," he said. "They are not commercial entities, they
don't have servers, they cannot be sued. The recording
industry can sue the individuals, but the individuals are the
customers of the recording industry."
The injunction "might actually cause labels and Napster to
come to terms," said Jeffrey Okkonen of Liquid Audio, an
Internet music company.
"There's just as equal a possibility that Napster goes
under. But I think the Internet will stop appearing to be the
Dodge City that it's appeared to be."
Napster has attracted more than 60 million users worldwide
in less than two years, but the recording industry and others
contend it allows massive piracy of copyrighted works.
The case is seen as a key test of whether copyright and
other intellectual property laws can be applied in cyberspace,
where music, movies and other forms of entertainment can be
transferred with the click of a mouse.
Under the court injunction, once Napster is notified about
a copyright violation using its website, it must block the
transmission within three business days. Napster was also
given five business days to show it is complying with the
Napster's Web forum was flooded with messages about the
decision, with many predicting the death of the service.
One posting from "Anonymous Coward" said, "I can no longer
sign on to Napster due to me having copyrighted material.
Sorry Napster. R.I.P. Where do all of us "thieves" go now?
http://www.bearshare.com is a Gnutella like server that cannot
be shut down because it does not have a central server. That
is where I will be."