Caught Napping: Free file-sharing v the American music industry
• Jim Johnson

The Brit Awards are supposed to showcase the best of British pop music talent. This year, the British acts on the Brits were very disappointing. Coldplay have released a couple of brilliant singles, but their album is a boring and dismal affair. If this lot really are the ‘Best British Group’ and responsible for last year’s ‘Best British Album’ then our music industry is in a bad way. There were some talented and influential winners at the Brits that night – but they were all picking up awards in international categories, and they were all American. Eminem, Kelis, and Madonna all released groundbreaking material last year and were justly awarded. Here they were, attending a ceremony where the only British winners were boy bands and indie nobodies. Except of course for Robbie Williams; the Brits obviously not of the opinion that the ex-Take That star might be starting to lose his appeal after producing three similar sounding albums. Then there was Sonique, ‘Best British Female Solo Artist’ – presumably that award must have been given for her outstanding contribution to cheesy, mid 1990’s style, handbag house.

America remains the central force in pop music and continues to produce a majority of the music listened to around the world. Today the American recording industry is huge. The global market in 1999 was worth $38.5 billion; the US dominates this industry with a 37% share of world sales. But something new has come along to give the industry a major headache. On February 16, 2001, it was announced by the Recording Industry Association of America (RIAA) that the US market for recorded music had actually declined in the last six months of 2000. This decrease was attributed to the dramatic reduction in sales of CD singles, which fell by 38.8% in 2000. This was preceded by 200% growth between ‘95 and ‘97 and slower but steady growth between ’98 and ’99. The RIAA attributes this decline to changes in consumer purchasing habits brought on by new options provided by the Internet. Free access online seems to have a dramatic effect on the singles market, according to Hilary Rosen, president of the RIAA.

The free access online she refers to is provided by Internet sites such as the infamous Napster. It has recently become a major concern for the music industry, especially in America where Internet access is more widespread than anywhere else in the world. Shawn Fanning founded Napster in May 1999. It provides a file-sharing service via the Internet for a community of users. The company’s software enables users to access music on other people’s computers through a single interface. Using MP3 format – which is a form of digital compression – songs can be compressed into relatively small computer files, without losing much sound quality. The files are then downloaded onto individual computers. Napster’s base of registered users is about 50 million people.

Free file-sharing is a bit of a Robin Hood concept. ‘Rich’ record companies are ripped-off to benefit us ‘poor’ music buyers. This is a very anti-capitalist idea and therefore also very un-American. But as we have seen from demonstrations in recent years against the World Trade Organisation, more Americans are starting to feel that capitalism isn’t always best. Entrepreneurial spirit and a sense of fair-play are also part of the American psyche. Napster encapsulates these sentiments by attacking what it sees is an unjust industry, badly in need of reform.

As expected, federal court action against Napster was not delayed. It began in San Francisco in December 1999. Five record companies – Sony, Warner Brothers, EMI, BMG, and Universal, brought the original case. Napster’s lawyers fought back by claiming that their site did not provide an illegal pirating service but merely promoted personal file sharing which is totally legal. In the original trial Napster was found guilty of wholesale copyright infringement and was ordered to shut down, pending a full trial. But the court granted a last minute appeal in October saying that it needed more time to consider the issues, and Napster continued its service.

Since then Napster has made various attempts to appease the record labels and deter further court action. It started by blocking files from objecting record labels. This did little to solve the problem though, as users often name their own files. For example, Metallica (one of the bands at the forefront of the anti-Napster campaign) can be found on Napster as M’talica, Mtlca and under various other synonyms, not all of which can be blocked.

Napster’s latest peace effort involves the introduction of a subscription service. Users will subscribe to a ‘Basic Members’ or ‘Premium Members’ plan, expected to cost between $2.95 and $9.95 per month. ‘Basic Members’ would be limited to the amount of files they could download, ‘Premium Members’ would have unlimited access. From the subscription funds, Napster offered to pay $1 billion to labels and songwriters over five years. The amount received would depend on the number of files transferred. It seems, however, that most labels have plans to make their own file-sharing sites to maximise profits, and simply want Napster to close. Harry Barry, Napster's chief executive officer conceded in March this year that the $1 billion peace offer was heading for the scrapheap.

The future of file-sharing is unpredictable but Napster has already sold its soul. What started as an attempt at reforming an industry dominated by corporate interests has now reached a stage where it is being forced into co-operation. When we hear of copyright infringement by Napster it is usually against record companies, not the artists themselves, who rarely own the rights to their own music. So if Napster begins a subscription service then people will be paying to satisfy rich record labels, not the creators of music today.

Napster founder - Shawn Fanning

Copyright is an important issue, but it is something that needs reform. If all Napster has done is to bring this issue to the fore then it has served a great purpose. The Internet is something totally new that was not part of the equation when existing laws were made. Hopefully it can serve as a way of shifting the balance of power away from corporations, allowing artists to benefit more from their work and hopefully consumers too. US record companies seem to be against any reform. How will they stop it? By pursuing every Napster copier out there? Sites like Gnutella and Freenet among others provide the same service as Napster but haven’t faced the court battles yet. Closing these down would surely take years, cost millions and then simply clear the way for more file-sharing sites to follow in their wake.

When the RIAA announced that free online access was eating away at singles profits it was also true that the sales of CD albums continued to rise by 3.1% in 2000. Surely this trend and the decline of singles is more to do with the drive by record companies to create an albums market. Singles are used mainly as promotional tools, intended to advertise albums. It is albums that make record companies money, they cost more and have a potential shelf life of decades, where as singles are usually quickly deleted. Singles are disproportionately costly, in the UK one good song and a few dodgy B-sides will set you back around £4, for about 3 times this price you can buy an album containing around 11 times more ‘proper’ songs. Should record companies be surprised that people aren’t bothering so much about singles any more?

It used to be home taping that the music industry claimed was killing music. Can they not see that file-sharing like tape copying is probably doing them a favour? If people haven’t got the money to buy more music they can’t, whether they want to or not. If they then choose to download it for free or tape it they are getting something that they wouldn’t have paid for anyway. This then acts as an advert for the artist. If a person really likes a pirate copy or a Napster file they may eventually go out and buy a better quality original. They might play it to their friends who go out and do the same.

How many times do albums turn out to be a disappointment? Nothing more than a few singles and some ‘album fillers’. If record companies want us to stop using sites like Napster and making home copies then they should stop letting artists get away with this. If they improved the quality of their products and reduced their extortionate profit margins, finding an alternative wouldn’t be such a tempting option.

© Jim Johnson

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