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D o w n l o a d e d
N. e. w. s. and A. n. a. l. y. s. i. s.
In Digital Entertainment and Entertainment Technology

Son of Napster
Napster and Bertelsmann unveil plan

Napster Lives!
Posted by netwebly |2.12.2001

What Happens Next?

Downloaded: Main Page

In a move intended to quiet speculation about the file sharing program's fate, Napster and German media giant Bertelsmann unveiled their plan to create a legal, non-infringing version of Napster on Friday.

The proposed changes are almost guaranteed to make the next generation of the program virtually unrecognizable from the software which has caused a worldwide sensation over the last year, although the parties involved insist the changes will be almost undetectable for the average user.

The key to the new system will be a proprietary digital rights management scheme which the two companies are arguing will leave the user experience essentially unchanged, even as it protects copyright holders from the kind of unregulated mass duplication that has made Napster famous - a goal many observers had long ago concluded was next to impossible.

Under the proposed plan, Napster users will still be able to share the MP3 files on the hard drives of their computers and download anything they like from other users, just as they have in the past.

The Digital Rights Management component of the plan won't come into play until after a file has been downloaded. That's when the encryption part comes in - and where the details of the plan start getting slightly iffy.

This much is clear: after downloading files users will need to use a key to unlock protected files, a process described as being as unobtrusive as possible - which probably means the encryption will be built into the Napster software itself.

Users who have not paid a fee to subscribe to the service will still be able to listen to tracks a limited number of times before they expire and become unplayable.

Under the plan, subscribers will also be able to add various a la carte options. For instance: for an unspecified fee you'll be able to burn the tracks you've downloaded to CD or possibly make duplicate copies for your own personal use.

If it sounds like a plan tailor-made to appeal to the recording industry and potentially smooth relations with aggravated content holders, well, that's exactly what it is.

This is an idea that - if it works as promised - could create what could easily become the most efficient, most sophisticated and most profitable moneymaker in entertainment history.

Forget the talk about a one size fits all subscription plan - that was clearly a red herring, intended to buy a little more time and a little more breathing room for Napster. The breathtaking beauty of this sort of plan, from the point of view of an entertainment giant like Bertelsmann, lies in the staggering number of creative ways in which such a system can be used to make money.

Start with this subscription idea and take it from there.

Why allow your subscribers unlimited downloads when any thirteen year old could tell you that the real money lies in engineering a system that mass produces profit?

Think about the way the cell phone market works: different plans for different people, different options for different plans, different suboptions for different options - I'm willing to bet good money that Napster and Co. figured out a long time ago that the real money is in the plans.

Not to mention in the add ons that fall neatly into place once you have the plans set up and the content protected to your satisfaction: in the one-time setup fees, in the single download option, in the attractively priced download pack, in the buy-one-get-one-free download deal, in the one day specials, in the promotions, the marketing tie ins.

Finally enough, perhaps, to have even the most hardened, Napster-hating entertainment mogul taking a deep breath and contemplating a photo op with Sean Fanning.

Or is it?

The logistics involved are insurmountable enough to make it unlikely that any such plan could ever succeed anywhere but on paper, which is why I rate the chances of eventual success here at somewhere to the left of zero.

Not because I want the idea to fail, or because I agree entirely with the people who argue that music should be free, or because I am angry at Napster, or because I am imagining some happy skippy picture perfect utopia where we all use FreeNet every day, but because that's the way it is.

Faced with an ultimatum from the courts that requires the company to do everything in its power to block unauthorized downloads Napster is in a terrible position.

It's not even known if such a goal is technically possible, and if it is, how long it will take to achieve.

The company has enemies on every side - in high places, in low places, in Government and in Business, and is gaining more every day. Even the fans are starting to get annoyed - something any politician can tell you is not a good sign at all.

Then there's minor matter of damages to be paid that could potentially total in the trillions of dollars or god knows - even the gazillions.

And there are how many more irritating little questions?

Will the Digital Rights Management idea even work?

A lot of people believe the whole DRM idea is a hoax - when you get right down to it, not much more than another bullshit business model posing as a convenient solution.

It could work. It might work.
But will it?

And what happens if it doesn't?


Napster lives.

In a surprise decision, the 9th Circuit US Court in San Francisco ruled this morning that Napster may continue operations for the time being, keeping the controversial file sharing service alive, if only temporarily.

The Court said the existing injunction against Napster is too broad - but implied that Napster is probably guilty of violating copyright law - a key to the Recording Industry case against the company.

"Napster may be held liable for contributory copyright infringement only to the extent that Napster knows of specific infringing files,"

The decision may mean that Napster will be able to survive in some shape or form, although it is likely that the heady days of unrestricted file sharing on the service will soon be over.

No surprise on this one however: the web site for the 9th Circuit court crashed just hours before the ruling was to be released, easily overwhelmed by the inevitable wave of surfers eager to read the ruling.

To view a mirror copy, click here. Be warned: this opinion is long, dry, contains many large words. You'll probably want to skim it.

Clearly unhappy with the ruling, Napster said it will appeal the decision. "Napster is not shut down, but under this decision it could be. We are very disappointed in this ruling by the three judge panel and will seek appellate review. The Court today ruled on the basis of what it recognized was an incomplete record before it. We look forward to getting more facts into the record. We will pursue every avenue in the courts and the Congress to keep Napster operating."

Ruling Expected

The Ninth Circuit US Court of Appeals
is expected to issue a ruling on the Napster case on Monday morning, which means there is a very good possibility that this time next week, we'll all be bemoaning the loss of one of the coolest, not to mention one of the most controversial, software programs ever created.

The Court is expected to post its decision on it's web site by eleven o'clock in the morning. Don't be surprised if the news leaks earlier in the day, however. The media swarm has formed and is already ravaging the streets of San Francisco as we speak, howling like a pack of wild wolves, baying at the moon, racing from the Presidio to Market Street and back again, overturning cable cars, smashing down doors and conducting random, illegal searches and wiretaps in search of the one credible source that will give one reporter his or her fifteen minutes of fame.

In the past, Napster has said that it will comply with whatever decision the court makes. So, if the company's appeal fails, the plug is pulled, there's not much question about that.

Of course, even if Napster is shut down on Monday, it's unlikely that the game will be over. If they loose the appeal, Napster will undoubtedly ask the Supreme Court to review the case, since the alternative would probably be to sit still in one place and wait for what in all likelihood will be the most punitive and punishing damage award ever granted by any court anywhere. An award that will most likely make the damages awarded to the labels in the copyright case earlier this year look a lot like a slap on the wrist.

With the importance of the issues at stake - with the profound implications for copyright law, for the law of intellectual property, for everybody's privacy and for the future of content on the web, it seems almost inconceivable that the Supreme Court would pass up on the opportunity to establish a solid precedent. On the other hand, they just might. Refusing to hear the Case would also establish a precedent - one that's frightening to contemplate.

What Happens Next?
Special to
Posted by netwebly | 2.10.2001

Assuming Napster looses, several things are almost guaranteed to happen. They probably all won't happen on Monday. Or even on Tuesday. As a Veteran NewsDog would put it, it will be a serious week newswise, all week long. And it will be interesting, I'll guarantee you that much.

  • About Five Minutes After
    ...those famous Servers are shut down, All Hell Breaks Loose.

    Expect the Napster story to lead the national news, assuming nothing particularly serious happens on the international front in the intervening 24 hour period, (like let's a say a Coup in Washington or a small Nuclear War in the Balkans). As a result, traffic on the Net will surge dramatically as people go online to follow the story and check out information about their alternatives. If you run a file sharing site, you already know this, and you've been busy making preparations all weekend long. On the other hand, if you're one of the people who is trying to visit one of those sites, don't be surprised if you're unable get much done - many sites will go down. Nobody is ready for this kind of traffic.

  • Rumor Will Run Rampant...
    Yes, it will be entertaining, to say the least. The Media Swarm has been looking for a story to fill in the void left by the 2000 Election Fiasco for over a month now. The Swarm is hungry, bored and desperate for something - anything - that smells like or vaguely resembles a Story. This means "serious" journalists who ordinarily wouldn't touch technology with a ten foot pole will be getting in on the action, asking predictable questions and using up a lot of airtime.

    Is a shutdown right? Wrong? A National Tragedy or A Declaration of Intergenerational Holy War? Even, (snicker, snicker) "What happens Next?"

    These questions will all be asked, along with a few others, many of which will be rather silly and pointless. The moral? If you're fifteen years old and you own a Napster Tee Shirt, and you can find yourself a TV crew, chances are good you can get your mug on the tube. You may want to consider writing a speech in advance.

  • A Small, Pointless, Web-Based Civil War...
    ...will break loose in the United States, which will spread around the Globe in the course of a few hours or days: don't expect Molotov Cocktails and rioting in the Streets. Do expect the most serious outbreak of disorder and lawlessness to ever hit the fiberoptic highways. Denial Of Service Attacks on major E-Commerce Sites, Strange and horrible New Viruses. Exploding Email Attachments and other Random Acts of Senseless stupidity.

    Whether the EFF likes it or not, the Napster case, and the file sharing debate surrounding it, is the most highly politicized issue facing the Netizenry. For a lot of people it's a symbolic thing. Napster stands for something in many people's minds, whether that's justified or not. Do not despair: Declan McCullough and Wired News will be there, wearing Flack Jackets, Face Paint and Combat Boots.
    Unfortunately, they'll be talking about Encryption.

  • The Net will be flooded by ...
    ..strangely worded postings attacking the RIAA, Hilary Rosen, and US Legal System, and the Recording Industry, few of which will make any sense and all of which will contain numerous incomprehensible SPELinG ErORs and grammatical lapses. The Net will then be flooded by a second Wave of Postings, making fun of the spelling errors and general naiveté of the first Wave. The resulting Flame War will go on for the next One Thousand years.

  • The "Gnutella Scenario" will finally play out....
    Millions of unsuspecting newbies will experience Gnutella for the first time, leading to a quite predictable series of cataclysmic/not quite-so-cataclysmic events including: three weeks to a year of network Chaos on Gnutella itself as the network strains to adapt to the mind boggling new level of traffic it has to cope with, a dramatic increase in the amount of free pornography downloaded on the web, an increase in software piracy, and most tragically of all, an increase in General Unhappiness and Woe as people discover how easy it is to catch a virus from a corrupted text file that says it contains credit card numbers.

    And lest I forget, the number of illegal MP3 files traded on the Net will also continue to rise - despite all of these problems - as refugees from Napster flood alternatives like Gnutella, the Napster Clones, iMesh, FreeNet, Aimster and countless others where they will be joined by millions of curious new users drawn by the millions of dollars worth of free media publicity the crisis will create.

  • The "Moment of Truth" Will Arrive...
    Emboldened by victory, the RIAA and the Major labels will launch a series of blitzkreig-like legal strikes against other file-sharing applications and sites where information about "file sharing piracy" is spread in an effort to consolidate power and mop up resistance. After a brief lull, expect Recording Industry lawyers to take action against the owners of many of the Napster alternatives based in the US, including the various Napster and Gnutella clones. With the Napster case as precedent, expect these cases to move quickly through the Justice System.

    Don't expect the Bush Administration to be much help - if anything, you can probably count on the Justice Department getting involved on the side of Content Providers. Despite the clear evidence that file sharing is completely legal - at least on some limited, undefined level - expect this fine distinction to be one that is missed by crusading corporate lawyers with a quota to fill.

    In the aftermath, you can count on a Draconian new Content Law rearing it's ugly head, the result of a great deal of behind the scenes maneuvering over the last six months on the part of Content Providers. Such a law will attempt to clarify the chaos caused by the Digital Millenium Copyright Act and will presumably addresses many of the copyright issues raised by Napster and the Net in a sweeping, overly general, anti-consumer, pro-business fashion.

    The good news is, it may not pass. We have some ornery, annoyed Democrats on the Hill these days, as well as some remarkably independent 'Publicans - Dubya excepted.

    bad news is, it might...

  • The West Coast of the United States will...
    experience a 72 Hour Monsoonlike Deluge of press releases, many of which will actually be read by the people they are sent to. The RIAA will say "We told you so. Now we want our money." The Major Labels will say "We told so. We want our money .... and come to think of it we have this really cool co-branded alternative we think people are going to go nuts over."

    Needless to say, the RIAA will get eventually get its money and the Labels will get their co-branded alternatives. In a nice stroke of poetic justice, the co-branded alternatives will all fail before the year 2001 is out, as people discover that there isn't much to be said for file sharing applications that don't let people share.

  • Your email inbox will also be flooded
    with marketing drivel originating from's corporate headquarters in San Diego, with a new email arriving approximately once every five minutes for the next one hundred days.

    With Napster out of the picture and eMusic on the verge of self-immolation, will be just one of many sites that thinks it stands to inherit the keys to the kingdom. If the site's past track record is anything to go by, however, they'll blow it in spectacular fashion. Instead of pulling their content act together, and guiding millions of new visitors to the thousands of MP3 files on the site worth listening to, will, in typical arrogant tech company style, leave people to their own devices and take the opportunity to launch ten to twenty new services, featuring bells, whistles and handheld devices and then follow up by signing deals with QuickieMart and Taco Bell.

  • Courtney Love... will do something.

    Don't know what. But she'll do something.


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