Quantcast
"Our member company plaintiffs have always said that they stand ready and willing to meet individually with you to discuss future licenses. This path would be more productive than trying to engage in business negotiations through the media."
——Today's statement from RIAA head Hilary Rosen
NAPSTER'S BILLION DOLLAR GAMBIT
A Reasonable Offer Or Smoke And Mirrors?
Marc Pollack & Simon Glickman

In a move to consolidate popular support in its struggle with record labels, Napster has made public the business plan it has been presenting to the industry for several months. The plan calls for $1 billion to be paid over five years to copyright-holders.

Napster is spinning the proposal as a generous capitulation that will allow everyone to move forward. The $1 billion payment—which is contingent on the recording industry dropping its lawsuit—breaks down to $150 million per year in licensing fees to the majors and $50 million per year to independent labels and artists. The yearly fund would be split according to the volume of downloaded material owned by the various participants.

The proposal, shopped by a team of executives from Napster and supporter Bertelsmann, calls for future licensing payments of songs being swapped, but has no provision for damages covering past infringements.

Though Napster has gone to considerable lengths to publicize the details of a proposed subscription-based service and its various ostensible revenue streams, they've had no success wooing new major-label interest. Industry observers have almost universally dismissed the latest offer, viewing it as little more than a publicity ploy.

RIAA chief Hilary Rosen on Tuesday (2/20) issued a preemptive statement. "To the management of Napster I say again: You claim you want to be legitimate, and negotiate licenses based on real business models," she declared. "I urge you to act accordingly. Stop the infringements, stop the delay tactics in court, and redouble your efforts to build a legitimate system.

"Our member company plaintiffs have always said that they stand ready and willing to meet individually with you to discuss future licenses," Rosen went on. "This path would be more productive than trying to engage in business negotiations through the media."

UMG issued a statement following the breaking of the offer story. "It is Napster's responsibility to come to the creative community with a legitimate business model and a system that protects our artists and copyrights," it reads. "Nothing we have heard in the past and nothing we have heard today suggests they have yet been able to accomplish that task. Until that time, should it occur, and, indeed, at all times, we expect Napster to fully comply with the law."

Napster CEO Hank Barry, meanwhile, continues to assert his plan as a win-win for all. The time has come to talk seriously about a deal, he told HITS. "Otherwise, we're going to continue down this path—which we have every legal right to do—to pursue our remedies in court," Barry said. "As do [the labels]. We're just going to keep on slugging this out. In the meantime, artists are not getting paid and we have a huge cloud over this company. And this thing that consumers really want is in great danger of just going away.

"I want to make clear to the public that we're putting real money on the table, we're asking for a license and we should have some meaningful settlement discussions," he added.

Barry continues to trumpet the proposed paid version of the service, but he keeps hearing from the industry that it isn't viable.

Would his antagonists prefer to see Napster die and protect the status quo (or a future they have a greater role in shaping) than partner with it and pocket some cash? Could Napster really guarantee the revenues it's projecting in its dog-and-pony show?

One thing's for sure: This story is far from over.


 

 

 

BIEBER POSTPONES TOUR
New dates to be announced soon. (4/1a)
TOURING IN 2020:
HOW IT LOOKS NOW
Uncertainty from coast to coast (4/1a)
LIVE NATION CREATES CREW NATION,
PLEDGES $10M
Very cool move (4/1a)
REVENUE CHART:
LOONEY WEEKND
MVP frontunner of 2020 (4/1a)
VIRTUAL CONCERT AND LIVESTREAM ROUNDUP (UPDATED DAILY)
Giving home entertainment new meaning (4/1a)
WE FOUND SOME TOILET PAPER
Also known as back issues of HITS.
SOCIAL DISTANCING
We turn out to be pioneers.
STREAMING STORIES
The music doc shows new muscle.
ELECTION 2020
Not postponed yet.
 Email

 First Name

 Last Name

 Company

 Country
CAPTCHA code
Captcha: (type the characters above)