Napster is an online music service that was originally a file sharing service. Napster made a major impact on the Internet in calendar year 2000 when it reached the height of its popularity. The company has a remarkable history. In early 1999, Shawn Fanning began to develop an idea of sharing music formatted as MP3 files. He thought of the idea of using a search engine dedicated to finding MP3 files combined with the tools needed to trade files called file sharing. The trick was to share files without having to use a centralized server for storage. Once the software was perfected, all that was required to make copies was copy of the Napster software, a shared directory so that remote users could access files, and an Internet connection.
The biggest problem for Napster was the copyright laws of the United States provide copyright protection in sound recordings. Most of the songs traded on Napster were copyrighted. Napster had not licensed the copyrights. However, Napster facilitated trading of copyrighted material. Napster was sued by the holders of the copyrights. Napster lost in Court against the powerful conglomerate known as the RIAA (Recording Industry Association of America). Napster filed for bankruptcy protection, and the assets of the company were liquidated in bankruptcy and distributed to its creditors in conformity with the requirements of the U.S. Bankruptcy Code.
What Napster failed to appreciate is that if anyone wants to use a copyrighted song in any public venue, they must first obtain rights from the publisher and in some cases from the music label that produced the song. The problem that the music industry had with Napster was that it was an automated way to copy copyrighted material. At its height, there were more that 10 million registered users at Napster. These users made tens of thousands of copies of copyrighted songs every day without paying any royalties to the music industry or the arti
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