Background

Napster was started in 1999 by Shawn Fanning, then an 18-year-old freshman computer science student at Northeastern University. It provided a platform for users to access and download compressed digital music files, specifically MP3s, from other users' machines. Unlike many peer-to-peer services, however, Napster included a central server that indexed connected users and files available on their machines, creating a searchable list of music available across Napster's network. Napster's ease of use compared to other peer-to-peer services quickly made it a popular service for music enthusiasts to find and download digital song files for free.

Although there were already networks that facilitated the distribution of files across the Internet, such as IRC, Hotline, and Usenet, Napster specialized in MP3 files of music and a user-friendly interface. At its peak the Napster service had about 80 million registered users. Napster made it relatively easy for music enthusiasts to download copies of songs that were otherwise difficult to obtain, such as older songs, unreleased recordings, studio recordings, and songs from concert bootleg recordings. Napster paved the way for streaming media services and transformed music into a public good for a brief period of time.

High-speed networks in college dormitories became overloaded, with as much as 61% of external network traffic consisting of MP3 file transfers. Many colleges blocked its use for this reason, even before concerns about liability for facilitating copyright violations on campus.

Legal challenges

Heavy metal band Metallica discovered a demo of their song "I Disappear" had been circulating across the network before it was released. This led to it being played on several radio stations across the United States and alerted Metallica to the fact that their entire back catalogue of studio material was also available. On March 13, 2000, they filed a lawsuit against Napster. A month later, rapper and producer Dr. Dre, who shared a litigator and legal firm with Metallica, filed a similar lawsuit after Napster refused his written request to remove his works from its service. Separately, Metallica and Dr. Dre later delivered to Napster thousands of usernames of people who they believed were pirating their songs. In 2000, Madonna's single "Music" was leaked out onto the web and Napster prior to its commercial release, causing widespread media coverage. Verified Napster use peaked with 26.4 million users worldwide in February 2001.

Promotional power

Along with the accusations that Napster was hurting the sales of the record industry, there were those who felt just the opposite, that file trading on Napster stimulated, rather than hurt, sales. Some evidence may have come in July 2000 when tracks from English rock band Radiohead's album Kid A found their way to Napster three months before the album's release. Unlike Madonna, Dr. Dre or Metallica, Radiohead had never hit the top 20 in the US. Furthermore, Kid A was an album without any singles released, and received relatively little radio airplay. By the time of the album's release, the album was estimated to have been downloaded for free by millions of people worldwide, and in October 2000 Kid A captured the number one spot on the Billboard 200 sales chart in its debut week. According to Richard Menta of MP3 Newswire,^[17] the effect of Napster in this instance was isolated from other elements that could be credited for driving sales, and the album's unexpected success suggested that Napster was a good promotional tool for music.

Since 2000, many musical artists, particularly those not signed to major labels and without access to traditional mass media outlets such as radio and television, have said that Napster and successive Internet file-sharing networks have helped get their music heard, spread word of mouth, and may have improved their sales in the long term. One such musician to publicly defend Napster as a promotional tool for independent artists was Dj Xealot, who became directly involved in the 2000 A&M Records Lawsuit. Chuck D from Public Enemy also came out and publicly supported Napster.