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CNN Today

Free Music Controversy: Music Industry Takes on Napster

Aired April 14, 2000 - 1:24 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

LOU WATERS, CNN ANCHOR: The heavy metal band Metallica has sued three universities and a music software company for copyright infringement and racketeering. The federal lawsuit accuses the Internet music company Napster, the University of Southern California, Yale University, and Indiana University of encouraging the trade of copyrighted material. Now, Metallica faults the universities for allowing their computers to be used to download free digital music.

The conflict between recording artists and Napster has been brewing for some time. CNN's Dennis Michael filed this report from the University of California.

(BEGIN VIDEOTAPE)

DENNIS MICHAEL, CNN CORRESPONDENT (voice-over): Little is more important to college students than music, living away from home often for the first time, students get to here what they want without limitation. So why does Nate Dulley's stereo system sit in a corner gathering dust? his CDs stacked and unused?

NATE DULLEY, USC FRESHMAN: We haven't used that in a long time. I don't even play my CDs any more.

MICHAEL: The reason is MP3, the downloadable digital audio format that requires no tape or disk, simply computer memory. MP3s were something of a hobbyist format until development of a Web program called Napster. Napster makes the Internet a worldwide musical pool, enabling Nate to share his collection of MP3 files with hundreds of thousands of other Web-enabled music fans.

On college campuses, where students have high-speed Internet connections, Napster has become terrifyingly popular.

RICK RODRIGUES, EDITOR-IN-CHIEF, "RADIO AND RECORDS" MAGAZINE: College campuses are finding that 40, 60, 80 percent of the traffic that is going through their servers, the official college servers are programs that are being transferred through Napster. And there is nothing that anybody can do about it, really.

MICHAEL: Over 100 colleges have banned Napster's use on their computer networks, due in part to its use of large amounts of bandwidth. At the University of Southern California, where the program is allowed, they look at Napster as academically beneficial. JERRY CAMPBELL, CHIEF INFORMATION OFFICER, USC: There are actually legitimate music sites, there is legal music to retrieve through Napster, so in fact to lose the resource would have been a negative.

MICHAEL: It's popularity is no mystery. Using Napster, finding practically any music can be done with a few key strokes in seconds.

DULLEY: If I plugged in Tom Petty, and then plugged that in, and then it will come out with a bunch of songs like right here. And then you can choose whatever you want, basically.

MICHAEL: Although the Recording Industry Association of America is trying to get the courts to shut Napster, they insist they do not illegal copying or selling of copyrighter material.

EILEEN RICHARDSON, CEO, NAPSTER: We didn't invent MP3 or the Internet, but we made it just a little bit easier for people to share audio.

MICHAEL: But that sharing does not extend to the record companies. Exchanging MP3 files between individuals cuts the labels and the artists completely out of the loop.

RODRIGUES: They are losing more and more control over the distribution of their music, and the more they lose control the more they lose money.

MICHAEL: And the labels and artists prefer that they have the control and the money.

LOU REED: I know people think that swapping is fine, that they are just exchanging things with friends, but when you do it on the level they are doing it, and artists get nothing out of it. I think that is wrong,

MICHAEL: Are consumers concerned?

DULLEY: I knew that question was going to come eventually. But, no, it doesn't bother me at all. It doesn't bother me at all.

MICHAEL: But record industry observers say the stream of music flowing uncontrolled over the Web will soon become a flood of red ink.

RODRIGUES: It is going to be a significant enough problem where the record industry could be seriously damaged financially, if they don't find a way to stop the problem now.

MICHAEL: Nearly a million tracks are available through Napster and other similar exchange systems are springing up, putting a leash on MP3 may be a tall order for the music industry.

Dennis Michael, CNN Entertainment News, Hollywood.

(END VIDEOTAPE)

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