Musicians are furious that new tech has gutted their income. Record labels are wary, yet eager to cut deals with platforms. Fans happily access songs for a pittance, even as they're screwing over their idols.
The fears about today's streaming economy echo the existential panic when Napster debuted in 1999. The peer-to-peer service - where fans swapped catalogs of MP3 song files - walloped the record business.
It helped demolish billions in label revenue, forcing a sclerotic industry to reassess its entire model.
But beyond its effect on music, Napster also heralded a troubling new ethic in tech: make yourself ubiquitous before the law can stop you.
"Years later, Napster is still an exemplar and inspiration in Silicon Valley," said Joseph Menn, the author of All The Rave, the definitive history of Napster. "Uber and Airbnb took the same approach - blow away taxi and hotel regulations to give people something they want and grow so big you eventually get politicians on your side. Napster created this whole wave of antihero entrepreneurs."
When Northeastern University undergrad Shawn Fanning and business partner Sean Parker launched Napster on June 1, 1999, music was still largely consumed via compact disc, which labels sold at hefty profits. Fans had ways to trade songs, from taping off the radio to burning mix CDs, but nothing like this.
Fanning saw how a user-friendly platform could take the curiosity of song-swapping and escalate it via MP3s, shared over new broadband internet connections on college campuses. Users posted their digital music libraries online for anyone to see and download for themselves through a decentralized network.
"They mainstreamed an underground hobby," Menn said. "No one is going to go out and buy 100 records, but here the supply of music was infinite."
Estimates vary, but tens of millions of people downloaded the service, back when high-speed internet was a rarity in households. A quarter of all college internet bandwidth was used to share music on Napster. A US$40 billion (HK$312 billion) record industry began a downward slide that would eventually wipe out half its value.
"One reason Napster came to life was the record business gouging users," Menn said. "People were willing to pay for a reasonable digital alternative. But by not providing that, labels couldn't do anything about ripping a CD onto your computer."
Yet labels weren't sure whether they should sue Napster into oblivion or pay them hundreds of millions to get a piece of the action.Lawsuits from the Recording Industry Association of America targeted both Napster and individuals who'd downloaded songs, earning wrath from the record-buying public.
At the same time, Napster got into negotiations with Vivendi Universal and nearly struck a deal with labels to become a legal service.
"It could have gone either way," Menn said. "They couldn't pull it off, but the record business had a motivation to do a deal, because what was coming next was unstoppable."
Fanning, Parker and Napster executives were plagued with infighting from the start, especially around Fanning's uncle's 70 percent ownership stake.
Yosi Amram, a former Napster board member, told The Times then that the firm "blew a number of opportunities by zigzagging. It didn't have strong, clear leadership."
But they knew there was a legitimate business to be built in paid digital access to songs.
"Napster knew more about the customer than the labels did," Menn said. "They had access to your music collection, they saw what people downloaded."
In September 2001, Napster paid a US$26 million settlement to copyright owners, and the company filed for bankruptcy in June 2002.
It relaunched as a legal paid service under the software firm Roxio in November 2002, but the industry had moved on.
Apple's Steve Jobs had pushed a similar bargain for digital music - a clean interface where users could download individual songs for 99 cents.
Faced with new piracy sites like Limewire and Gnutella, the labels chose Apple and iTunes.
It's striking that the arguments around Napster are the same as the grievances over streaming today, only the heroes and villains have switched sides.
Lars Ulrich, Metallica's drummer, became the face of the backlash to Napster, yet alienated his own fans. Ulrich delivered 13 boxes of paperwork to Napster's offices listing hundreds thousands of users the band suspected were sharing their songs illegally.
"It's not that Lars was seen as wrong, it was just so un-rock 'n' roll," Menn said. "He was seen as on the sellout side of the spectrum."
Now, though, the really big businesses are the tech giants inspired by Napster's swashbuckling.
Mark Zuckerberg's Facebook's house motto was "Move fast and break things" - an apt description of Napster's impact too.
Companies like Uber learned from Napster that if you ignored regulations and scaled up quickly, law and industry would bend to your business model.
"The dot-com boom was a feeding frenzy where stupid companies went public, but Napster was a legit technology," Menn said. "Peer-to-peer was a terrific innovation, but it got captured by peak capitalism. It corrupted the way technology developed."
Fanning, meanwhile, sold his video game communication platform, Rupture, to Electronic Arts and led a few short-lived social-networking and chat apps.
He never achieved gargantuan wealth commensurate with his place in tech history.
"He was the poster boy, but he never controlled Napster," Menn said. "He was a nice guy from a poor background. He was quite shy and forced himself to be in the public eye, and then retreated to his reclusive self. He did okay afterward but he was not a titan."
Today, the record business alliances among art, commerce and fandom have shifted again.
Labels, desperate to avoid making the same mistakes, invested early in Spotify to ensure that they controlled streaming's future.
Now, only superstars like Lars Ulrich can make money on streaming. The indie artists who were fine with Napster in 1999 are now protesting outside Spotify's offices and working to unionize.
TikTok's recent fight with Universal Music Group was emblematic. Is it better for artists to have free, massive marketing possibilities or to get paid fairly by enormous tech firms? With artificial intelligence's looming influence on culture-making, who can you trust to look after your interests?
The answer is the same now as it was 1999: probably no one.
Los Angeles Times (TNS)
