University students who have grown accustomed to downloading free music from the Internet have suffered two significant setbacks during the past few weeks.
The first came during an Oct. 31 press conference, when officials from German media conglomerate Bertelsmann AG and Napster announced a strategic alliance. The second came just one day later, when Scour announced it would be shutting down Scour Exchange — the second most popular file-sharing service.
If Bertelsmann and Napster officials have their way, songs by popular artists such as Dave Matthews and Christina Aguilera will no longer be available for free over Napster networks. Both artists are on the BMG label, a subsidiary of Bertelsmann.
"Napster is going to evolve into a membership-based service that preserves the Napster experience and at the same time provides payments to copyrights holders," said Napster CEO Hank Barry, meaning Napster users may have to start paying for their downloads.
Bertelsmann, which still has a lawsuit in progress against Napster, will provide a loan to the company to help revamp its file-sharing services. "Once it's implemented it's very clear that we will withdraw the lawsuit and make our catalog available," said Andreas Schmidt, CEO of Bertelsmann's e-commerce division, BeCG.
Barry suggested a tentative price of $4.95 per month for a new premium service. However, he also promised, "The user experience will continue to include a free promotional file-sharing element."
The revenues from the new membership fees will be used to compensate record companies, artists and songwriters on a royalty basis. But Napster has yet to develop the technology to track download statistics for songs on its network, according to Barry. Without such technology, Napster has no way to distribute royalties to record companies.
Bertelsmann also appealed to other record companies to help Napster develop the new service. However, none of the major record labels, including Bertelsmann, have dropped copyright infringement lawsuits against the service.
The major record labels have also used lawsuits to force universities like Yale to block access to Napster. Princeton, however, has never faced such a lawsuit connected with Napster and has not made plans to block the service, according to University General Counsel Howard Ende. Nor is the University likely to make any change to its policy in the future, he said.
Scour announced the imminent demise of Scour Exchange one day after Napster's alliance with Betselsmann was made public. Scour recently declared Chapter 11 bankruptcy in the midst of a barrage of lawsuits.
Listen.com, which is partially owned by the five major record labels, agreed to purchase Scour but will not assume any of the liability from pending litigation, according to a statement from the company. As a condition of the sale, Scour Exchange will be shut down.
Though students may no longer be able to download their favorite songs for free from Napster and Scour Exchange, other free file-sharing services abound.
OpenNap and Napigator run services similar to Napster, and services like Gnutella and FreeNet have no central servers and thus are nearly impossible to shut down.
These services have far fewer regular clients than Napster and thus a smaller selection of music to download. But with the end of Scour Exchange and the possibility of having to pay for many songs off Napster, music lovers looking for free downloads may soon have to turn to these other services.
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