Two-Faced Napster?

A number of folks have written in about the article on MSNBC regarding the two faces of Napster. On one hand, they espouse the virtues of "sharing," but seemingly, when it comes to their own material, they are very insular. Good discussion piece. [Updated by timothy, 26 July 2000 at 6:25GMT: Lee Gomes, the author of the piece referred to here, wrote to point out that though MSNBC carried this story, it's originally from the Wall Street Journal, and that it's available from this link, no registration required. Thanks for the note, Lee.

Comments

Oh man, that's funny...

[pb]

Someone should write an article about the two sides of MS-NBC...
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pb Reply or e-mail; don't vaguely moderate.

Confusing Two Issues

[LaNMaN2000]

Unfortunately, the article ignores the distinction between copyright law and trademark law. Napster is advocating the sharing of copyrighted works, citing fair-use as justification for its position. Even if what couls be considered copyright infringement does occur, it does not diminish the copyright in the same way that unlicensed use of a trademark diminishes a trademark.

A trademark holder is required to actively protect its trademark in order to keep it out of the public domain--no such provision exists for copyrights. Therefore Napster is *legally obligated* to prevent unlicensed use of the Napster trademark in shirts/hats/etc. in order to ensure that 100,000 new distributed file-sharing projects do not have the ability to call themselves "Napster."

Trademarks are never "shared" over Napster, only copyrighted works are. Consequently, I do not see the hypocrisy.

(The one interesting point the article makes is about Napster's corporate structure and equity positions. I was unaware that the investors were able to pry over 90% of the company away from the founder. Fanning is an excellent developer, but he must be a *lousy* businessman.)

Re:Confusing Two Issues

[LaNMaN2000]

I disagree; Napster could have been wildly profitable if they played their cards right at the beginning:

1) Make 2 versions of Napster: one with just file-sharing capabilities to be released into the public domain, and one piece of "ad-ware" with premium features like chat, etc. Most users will only download the public-domain version, but judging from the number of people in Napster chat rooms, you would have at least 10,000 regular and 100,000 infrequent users of the premium version (at current rates, generating about $50k/month--not much)

2) Hardcode all versions of Napster to only connect to Napster.com. Even though competitors would spring up that use reverse-engineered servers with a modified version of the public-domain client, Napster could be sure that the vast majority of users who downloaded their software would use thier network exclusively without prohibiting reverse-engineering. Remember, Gnutella is technically superior but has far fewer users; Napster has a significant first-mover advantage.

3) Have the search results panel split beteen the matching MP3s with a "buy the single" affiliate link next to it, and affiliate links to buy merchandise and albums from the Bands whose MP3s are listed. Since most of Napster's users are music enthusiasts who already buy music on the Internet, this would be very convenient and incredibly profitable.

4) Instead of making "sharing" the theme of the service, make it "try before you buy" and "radio on-demand." This would give it a similar role to radio stations, exposing users to interesting music and effectively promoting all of the bands whose music is exchanged. Since purchasing the music is even more encouraged in this service, than it is with traditional radio stations, they would not have as much legal trouble.

5) Hold weekly promotions and contests that feature unsigned artists. This would be a huge traffic draw to their network that would cost almost nothing to organize (the top prize does not even need to be more than $5000 a week). These promotions would be far more effective than the Limp Bizkit tour at getting people to the Napster site and *keeping them there.* In addition, it would draw people who are more obsessed music fans (who are more likely to buy stuff) to the service. Plus, it would be years before it racks up a total cost of $2mil. Also, it would enhance Napster's image as a company that promotes unsigned artists instead of a service that specializes in pirating music.

Remember, the benefit of Peer-to-peer networks is that they have very low operating costs. Only searches and chats consume Napster's bandwidth; all transfers occur independently of their system and consume none of their bandwidth. All "content" is user-supplied and therefore content-generation costs no more than customer acquisition.

Considering how inexpensive the operating costs are, Napster could turn a serious profit if their MBAs/investors were not incompetant. I am only 18, with no business experience, and I can come up with this strategy; the investors that have jumped on board and the management staff they hired simply have not added any value to company, so it was foolish to surrender so much equity to them and give them control of the company.

Just my $.02.

Napster's Mistake

[ryry]

Fanning's mistake was to try and corporatize Napster. He wasn't satisfied with releasing an easy-to-use tool, he had to try and turn it into a successful business and make some money off it. Now he's got to balance Napster's sort of rebel reputation with the need to fit into corporate America, which isn't an easy thing to accomplish.

Damned if you do, damned if you dont:

If they pursue litigation with the Offspring, then their mostly teenage/young adult fanbase will see them as "selling out" and not only messing with a cool band but totally reversing their opinions on copyrighted material. If they leave the Offspring alone, then they're losing a possibly lucrative revenue stream in merchandising (they could make their own "official" gear, but c'mon, they'd sell it for more and it's cool to have the unofficial stuff as well :-)

I for one hope Napster pulls through - I think it's a great piece of technology and that the RIAA should work with them, not against them, to ensure the future of digital music. But I still think Napster should have been left as a Gnutella-style freebie tool with no intention of profitability underlying the coolness of swapping MP3s online.

As it is right now, they are cultivating an elitist image reminiscent of how many people view Microsoft - anticompetetive and unwilling to cooperate with others to further the technology empowering its very product. I certainly hope things turn around.

-ryry

Napster IS NOT STEALING ANYTHING!

[Lord Kano]

I don't understand why people don't seem to get this. They provide a service that can be used for either legal or illegal purposes. When someone is reported for using the service illegally, they terminate the account. What more do they need to do?

If you go to your local head shop and you ask to see the bongs you will be told that they don't cary aany drug paraphernalia. If you ask to see one of their water-pipes, you will be shown the best smoking accesories that they have. Once you've got your water-pipe, it's your responsibility to use it in a legal manner.

Or think of a pet store. If you go in and buy one hamster or gerbil per week, pretty soon they're going to wise up and stop selling them to you. If you ask for a shaved hamster, they're going to throw you out.

It's up to YOU, the user/client/patron to do the right/legal thing with any product/service. It is not the responsibility of the service/widget provider to insure that you walk the straight and narrow path. I don't care if it's easier to do it that way, it's still not right.

LK

Au contrair

[FreeUser]

You are correct with respect to copyright and trademark law, however, the spat with the Offspring was only a minor aside in the article.


More significantly, the company repeatedly has tried to stymie independent software developers working on Napster-compatible software and Web sites. While these programs could benefit the millions of music fans that Napster claims are its only constituency, they might also diminish the commercial potential of Napster itself.

The company has refused to share technical information about its software code, has made changes to its software that have prevented other programs from working with Napster's own and has blocked computers from outside music sites from accessing Napster's database of hundreds of thousands of songs.


Napster is hypocritical in that it is claiming to be a champion defending the right and freedom to share and then refuses to share its own information, including programing APIs, protocol speficiations, or simple access to the virtual net they've constructed from their users' PCs.

This is IMHO very hypocritical of napster.


The fact that Napster seems to sing a different tune when its own property is involved is just one of the ways the reality of Napster is at odds with its public image. The service's management and ownership structure, for example, is quite different than many users suppose, with Napster's highly publicized teenage founder, Shawn Fanning, playing only a minor role.


Herein may lie the problem. We have a bunch of suits in it for the money, and quite willing to toss a few platitudes our way to garner our short-term support, but in the end they have a vested interest in forcing us to use their product, and their product only.

If you want true freedom to share, don't rely on napster to provide, or even defend, it. Instead work with the folks at gnutella or freenet. You'll have much better odds of being able to run a client or server on the platform of your choice, and a much better chance of securing your own freedom.

In short, never send a capatalist to do an activist's job. The results will disappoint you every time.