Napster Cuts off Millions of Users as it Morphs into MusicNet

By Richard Menta - 6/28/01

When I attempted to log on to Napster this morning it was to see if they indeed were going to carry out their threat to shut down all versions of the software that does not include the latest incarnation with fingerprint technology. That threat came true as instead of being welcomed to the service I found on my Napster screen this:


Yepp 20T
- 32MB USB player weighs only 1.3 oz. Available for $99 at Amazon

In order to comply with the court order, we'll soon be disabling previous
versions of the Napster application -- so download Beta 10.3 now at
http://www.napster.com/download/

You must upgrade your client at http://www.napster.com

The question left from this is will I upgrade to have access again? The answer seems to be I have little incentive to. That's because this is only the first phase of Napster's actual metamorphosis into a pay subscription service, an act that should occur within the next two months. Am I ready to pay for Napster?

I have not been using Napster much lately. It has been difficult to get even legal files through the companies hyperactive filter system. I did download some terrific garage band music from a wonderfully enthusiastic, but obscure, garage band named the Detroit Cobras a few hours before the change happened. Now I can't download anything and, honestly, I don't know if I really care.

That's because the plans the recording industry has set for Napster as a pay entity don't really compel me.

The New Napster

To date, the company has only confirmed availability of music from one major label, parent company Bertelsmann. Napster's recent merger into MusicNet supposedly brings in AOL Time Warner and EMI to give the company access to the music to three of the five major labels. Unfortunately, both EMI and AOL Time Warner have put conditions on Napster's security protocols that will allow them to drag their feet on when they will make their music available on the service. They can even use it as an out if they want to.

If you want me to pay for this service, then give me a reason to pay for it. Even in a world where all the Napster clones are silenced and all the Net music sites are tamed, there just doesn't seem enough here to warrant a subscription.

Yes, I am spoiled by the old Napster, but so are 70 million other former users who too will ask the same question. Do they feel as I do? I bet many of the Napster loyal who ARE willing to pay for some kind of service are concerned that Napster won't give them enough for their hard earned buck.

MusicNet has leaked several pricing plans, all of which are ridiculously if not surreally overpriced. As we wrote in our June 7th article MusicNet Naps with Napster:

We did the math and discovered a CD's worth of music on these services will cost $20 to hold for only a single year (the files actually expire every 30 days unless a $10 monthly payment is continued. The service allows you to download up to 75 songs - equal to six 12-13 song CDs - for $120 a year). That is considerably more than the $8.99 standard that EMusic set for an MP3 album with no expiration date. It is even more than what a CD costs at the local record store and digital downloads don't have printing and disc pressing costs, shipping costs, or the record stores markup (record stores pay $11.99 for a CD). After a year you have nothing to show for your money. You can extend the life of that CDs worth of music for an additional year if you wish...for an additional $20. Once you do the math, it seems like a sucker deal.

Right now to subscribe to Napster, the game plan is you must also subscribe to the expensive MusicNet, conjoining the two into one service. If the above is to be their actual pricing structure, I am not impressed.

If there is something that separates the Net music products of the recording industry versus that of the Web industry is that the Web industry has always focused their products on, as Salon's Janelle Brown put it, "customer-friendly innovation -- personalization, portability, interactivity, access to hard-to-find tracks, and exposure to new music". Big Music, on the other hand, seems more interested in serving the politics and pockets of the traditional music industry.

This gives an even greater competitive edge to services like Morpheus, BearShare, LimeWire and the other present and future P2P services whose wares are unencumbered and free. The music industry can call these programs pirates, but as long as they exist they are also competitors. Competitors who serve their clientele better.

Napster recently signed licensing agreement with two European trade groups representing 2,000 independent record labels. That's a start, but until they come to a consensus with all five major labels Napster's offerings will always be behind that of the P2P services they are trying to extinguish. Maybe they will succeed in closing them all, but at their proposed pricing I have more incentive to walk away than buy from the only shop in town.

That said, MP3 Newswire will subscribe to both MusicNet and Napster to fully and fairly gauge what these services will actually offer the consumer. If services are mediocre and users shun the fees, I don't expect the offerings of the major labels to close down, I expect them to evolve to lure users back. That means concessions by Big Music to the music buying public, concessions that will re-create as much of the original Napster experience needed for people to want to pay for it. We want to monitor this evolution for users as it happens…if it happens.

Even if they control every music site there is, the music industry can't control Net music unless the Net audience lets them. The Web has empowered the consumer, but there is one power the user will always have and that is not to buy. The electronic companies that bet their DVD offerings on the Divx scheme learned that the hard way as consumers rejected those products.

Will Napster and MusicNet become the next Divx?

 

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