Napster Essay

1780 words - 7 pages

Introduction

The Napster case study differs greatly from the Ryanair case study in many aspects. During the time of this case study Napster was a free to use file sharing program. Because of its controversial nature and the fact that it was free to use we must focus on areas such as the products lifecycle and objectives of Napster as well as its effects on the music industry.

What is Napster?
Napster is a program that makes it extremely easy to find and download music in MP3 format. It is a widely know fact that no laws were breached in the writing of the program that allows for the transfer of files across the Internet via peer to peer connection although the bulk of the files transferred through Napster are songs that are protected under United States copyright law. The people who use Napster and download MP3's have not paid for the legal use of this copyrighted material, and these people are in violation of these laws.
It can be said that Napster is, in many ways a disruptive technology. The value chain of the music industry has been modified because:
- Napster reduces the power of established retailers
- It has caused a 'digital' service that changes technology
- It may cause price changes for music records

Company Background
In late 1998, early 1999, an 18-year-old college dropout named Shawn Fanning designed a program that allowed computer users to share and swap files, specifically music, through a centralized file server. His idea sprung from the complaints of many that searching for music on the internet was time consuming and didn't yield many results.
The program Shawn coded enabled people to download a free program from the internet and enabled users to share music files with other users who are also using the same Napster software.
By 2000 his program had developed and Napster now became widely known of and very controversial. Shawn Fanning can no doubt be said to be an accidental entrepreneur after his determination to make it easier to obtain the music he wanted.
With the ever growing popularity of Napster the Record Industry Association of America (RIAA), which represents five major record labels and a host of smaller labels felt something must be done to combat the Napster revolution. They stated "We love the idea of using technology to build artist communities, but that's not what Napster is all about. Napster is about facilitating piracy, and trying to build a business on the backs of artists and copyright owners,"
They claimed that the threat Napster formed would inevitably make music sales drop as people could simply download songs from their favourite artists for free.
Napster has caused a great stir in the music industry and with this came the attempted merging of Warner Music Group and EMI, two of the major players in the music industry. This attempted merger was rejected by authorities on the grounds it would great too great of a market power and lead to many undesirable results.

Napster's Industry
Napster is in...

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