Napster Shut Down 
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Wednesday, 26 July 2000

Napster, the online music service that allows users to swap MP3 audio files for free, was ordered to stop distributing copyrighted songs yesterday by Judge Marilyn Hall Patel. A preliminary injunction was issued against Napster despite attorney David Boise’s attempts to argue that personal copying of music is protected by federal law and that the main purpose of Napster is the promotion of new music.

The company contends that they do not encourage the transfer of copyrighted materials, and did not know piracy was taking place. Sued by the Recording Industry Association of America (RIAA) in December of 1999, Napster hired Boise, best know for being instrumental in breaking up Microsoft, to create a defense strategy for the San Mateo based company. The injunction will take effect at on July 29th, 2000 at 3am (EST) unless Napster can obtain an appeals court issued stay.

Despite music sales that are up approximately 3 percent over last year according to SoundScan sales charts, the RIAA claims that Napster has cost the music industry more than $300 million in lost sales. In a recent Billboard magazine interview, Napster CEO Hank Berry stated the company is trying to modify their business model so that it recognizes intellectual material and properly compensates its owners. Napster is licensing tracking technology from Liquid Audio that allows users information to be audited. It is possible that Napster could become a monthly fee based service and artist will be paid according to the amount of times their material is traded.

Other file swapping services such as Gnutella and will most likely face the same dilemma that Napster is in right now. will keep you posted as more details of Napster’s future unfold.

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