Downloading free music may soon be history, as plans to make Napster accessible only to monthly-paying members are now underway.
Napster Inc. and Bertelsmann AG, an international media enterprise, announced Tuesday the formation of their partnership to develop a new, secure membership-based music downloading system to preserve Napster in the face of legal troubles and compensate artists for their songs.
Bertelsmann eCommerce Group, a division of Bertelsmann AG, will provide a loan to Napster to facilitate development of the new service and will receive a portion of Napster's equity.
After announcing the partnership, Napster faces many questions from its 38 million users. But since the agreement is relatively new, Napster does not have all the answers yet.
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Foremost in many Napster users' minds is the fear of sky-high membership fees, but Napster has not released any conclusive costs. An official for Bertelsmann's public relations company said costs would not be prohibitively expensive to users, but at the same time the fees would provide ample compensation to the artists.
Napster must convince the market that its services are worth a monthly charge and are more valuable than the nearly identical services provided by its no-charge competitors.
Scott Bryant, second-year Law student, said Napster users value "the ease of use and free access to content" that Napster has provided in the past. Once Napster is plagued by fees and regulations, Bryant said, users might be driven towards other systems.
But he said Napster is currently more accessible and easier to use than its competitors.
Users have also questioned the legality of a company attaching a price to a service it has been providing for free. This, however, is not a legal issue but a business issue, according to University Law professor Robert O'Neil.
"People may be surprised and resentful," O'Neil said, "but there is no legal recourse."
The feasibility of securing a peer-to-peer sharing system - like Napster which just enables users to download files from each other rather than directly providing them with the music - also is uncertain. By nature, such systems are not secure, and program designers are tackling a difficult task to ensure that "Napster wouldn't be Napsterized," said an official for Bertelsmann's public relations company.
The four other major music companies - Sony, Warner, EMI and Universal - also have an avid interest in the partnership. All five companies are involved in the pending lawsuit against Napster for copyright infringement.
Although Napster confirmed that it has been in discussion with all of the companies except Warner, none have issued a concrete statement regarding their position on the agreement.
Bertelsmann pledged to withdraw from the record industry's lawsuit once Napster starts marketing a membership-based system, but Napster has not received a guarantee from any of the other four companies.