No such thing as free music?

Is this the end of the record industry?

Saturday 25 March 2001

By Broadcasting House's reporter Dan Damon

One of the most successful dot com businesses ever has been told this week to try harder to close itself down.

Napster allows Internet users to share music files without paying.

I've actually never not been able to find a musical artist

Danielle Eubank of BBC New Media

But now, under the terms of a court order won by the record companies, Napster has been filtering out tens of thousands of copyright songs.

However - because Internet file sharing is used by more than 64 million people, stopping Napster doesn't change things much at all .

The real questions now are for musicians and artists generally - about how they're going to make money in the future.

Free music

It has always been possible (though illegal) to copy music from tapes and CDs. But the advent of the internet gave access to free music on a much larger scale.

The man behind Napster

Using a system such as Napster, it is possible to use the internet to download one of 1.5 billion songs in a few minutes from the computer hard drive on which it is stored. For free.

Record companies crack down

This is not good news for the music industry.

They argue that downloading music for free prevents musicians from making a living.

This month at a district court in California the record companies won an injunction which obliges Napster to bar downloads of copyright material.

They have provided lists of songs and artists they want protected to Napster.

But this week they issued a statement saying the injunction is not working.

We think we shouldn't have to compete with people who don't want to pay us

Alan Dickson of IFPI

Lars Ulrich of Metallica rejects the idea that music should be available free on the internet. He says in that case if a plumber downloads his music for free, he should get the plumber's services for free too.

Direct access

Napster is a central clearing house - but other file-share systems have been developed which operated directly between people who want to share material.

It's not as if consumers are suddenly going to forget that they were once able to swop music

Heidi Fitzpatrick

In those cases, say music industry representatives, they will prosecute the individual users who have the material on their hard drives.

But that could be millions of people - could any company afford to take so many of its own customers to court?

Where next?

Heidi Fitzpatrick, a music industry analyst at Lehman Bros, thinks that record companies will not be able to fight internet distribution of music - so they should start trying to work out how to use something consumers obviously want.

You pay for the flow of the experience over time, you do not pay for the physical object

Jeremy Rifkin

Jeremy Rifkin, author of The Age of Access, also says that in the entertainment industry the old rules have stopped working.

He says that when transaction costs become zero because of a network system of exchange, there is not enough margin in an industry to make a profit.

But there may be another way of working. Musician Emily Richards allows her songs to be distributed for free over another internet system, mp3.com, because it promotes her website where she sells merchandise.

Her success allows this way of operating to work financially for her and the website.