Napster allowed the free download of the various music files which enraged the music companies because it resulted in losses to them. The legal complications had implications for the music industry.
a. The decision makers such as music companies, MP3 software companies, retailers, artists, and consumers expressed their views pertaining to the functioning of Napster.
b. The decision makers wanted to achieve their objectives. They also suffered from their various limitations.
c. There was a need for finding an alternative business model in order to avoid the demise of Napster.
The legal complications have compelled the Napster and other interested parties to find a solution to the legal problems that emerged due to the cases filed by the music companies against Napster. Control system plan could assure the music companies that their demands would be fulfilled.
Napster: Catalyst for a new industry or Just another Dot.com?
The Napster website has been able to attract large number of internet users who are allowed unlimited downloading of their favorite music albums in the forms of MP3 files. Earlier the music enthusiasts had to depend on the CDs marketed by the larger music companies. The artists also had to depend on the support given by the big five music companies for the publicity to their artistic works. The Napster software solved the problems of the music enthusiasts and the artists. However, the free downloading of the MP3 files affected the interest of the big five music companies as they claimed that their copy rights were being violated by the Napster website.
The legal complications were the main cause for the problems for the Napster. The music companies approached the courts demanding justice as they had invested huge amount of money for producing the music works. Their interest was being affected by the music downloads through the Napster website. The courts gave decision in favor of the music companies. This created a problem for Napster to allow downloading of an authorized music. The main decision makers were Napster, music companies, artists, retailers, the Recording Industry Association of America, and the consumers. They had to decide regarding the new practice of using MP3 files downloaded from the internet. The Napster had to respond to the court decisions which had challenged its way of functioning. Napster is the central place of indexing of the music albums which could be downloaded free of cost by the music lovers. However, the court gave the verdict against this practice suggesting that Napster needed to find an alternative business model. Finding an alternative business model became the major problem for the Napster. The problem for the big five music companies was the nature of their relationship with the Napster. They believed that Napster dealing had allowed the violation of their copy rights leading to the loss of millions of dollars to them.
However, some music companies wanted to cooperate with Napster in order to capture the major market share. At the same time, they knew that it was not possible to cooperate with Napster with the existing business model. The retailers believed that Napster had increased their sales although many preferred to avoid it. They found it difficult maintain understanding with Napster as they did not want it to affect their sales. The consumers were satisfied with the free downloads. However, the introduction of new business models would have discouraged some of the consumers although many would continue to buy the products from this website. The different decision makers had to find answers to these different questions. They could not allow the death of Napster because that would have resulted in the emergence of other popular websites which could not be controlled as they did not have any central server which stored and distributed the music files.