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effect on CD sales under
debate Music distribution model still far from
The Daily Oklahoman
2001 The Oklahoman Publishing Company. All Rights Reserved.
STILLWATER - When the Recording Industry Association of
America first brought its lawsuit against Napster Inc., the
Internet song-swapping community with over 50 million members,
it claimed 90 percent of all music downloaded via Napster's
servers was pirated.
Whether record sales have been hurt by Napster is unknown.
But Nicholas Economides, professor of economics at New York
University's Stern School of Business, said any effects are
"The issue is debatable, because sales data cannot say for
sure," Economides said, "But I don't think Napster has had a
big effect on the sales of CDs."
Economides says whatever ill effects Napster has had on CD
sales has been offset by the number of CDs it helped to sell.
"There are some people who get on Napster and download a
song and never buy the album," Economides said, "But there are
also people who download a song and like it enough that they
go out and buy the CD. We cannot say for sure how big this
effect is, either way."
On Monday, the 9th U.S. Circuit Court of Appeals in San
Francisco ruled that Napster had "knowledge, both actual and
constructive, of direct infringement" of copyrights and that
it must halt that infringement once a lower court makes its
case more specific.
Journalism professor Joey Senat, who teaches mass
communication law at Oklahoma State University, said he's not
surprised by the decision.
"They were clearly contributing to someone else's direct
infringement," Senat said. "In short, they're helping other
people steal copyrighted material."
"The people who were directly violating the law were
downloading," Economides said. "Napster was found liable, but
it was really only secondary infringement."
After the lower court delivers its rewritten case, it is
likely Napster will be shut down - at least temporarily.
In a statement to the media, Napster founder Shawn Fanning
said the company has been "developing a Napster service that
offers additional benefits to members of the community and,
importantly, makes payments to artists."
Fanning said he wants the new service running within the
year, but Economides said that model is still a ways into the
"Technology has made this new distribution model almost
inevitable," Economides said. "They're still far away from
implementing this model."
Even with a new pay-to-download format, some are skeptical
about Napster's chances for survival.
Jeff Klein, electrical engineering senior at OSU said,
"It'll work if they keep the cost low enough, but I probably
wouldn't get a monthly subscription."
Economides said, "Once people get used to transferring
music for free, it will not be easy to stop that. I don't
think closing down Napster is the end of the peer-to-peer
music trading," because new programs such as Gnutella and
Freenet allow song-swapping to continue.
The new trading services have solved the problems that got
Napster in trouble, because they have no central servers and
thus no one to be held accountable.
"To close down Gnutella, you have to sue the individuals,"
Economides said. "And that is a whole new problem for record