By Evan Hansen, John Borland and Mike Yamamoto
Staff, CNET News.com
May 15, 2000, 4:00 a.m. PT

Napster has done for piracy what America Online did for the Internet: put its technology within reach of the digital masses.

But where AOL has catered to middle America, Napster has opened the door to an entirely different culture, one of evolving social values that some say encourages illegal activity.

So far, the file-sharing software program and others like it have been used primarily to download digital music. However, as the Net overcomes today's size and speed barriers, these technologies could be used to trade everything from full-length movies to computer operating systems--basically, anything that can take a digital form.

Moreover, opponents say Napster-like technologies are proving far more pernicious than previous forms of piracy, as underground programmers work to create diffuse networks providing safe harbor for the burgeoning trade. Industry countermeasures such as encrypted locks have touched off a virtual arms race that cannot guarantee lasting security.

Already transcending music, Napster's wildfire popularity is forcing whole industries to reconsider their business models. Companies are realizing that the last shelter for the digital economy may be imaginative strategies that make use of widespread file-sharing rather than fighting it, just as most content companies abandoned online subscriptions for free Web sites years ago.

Napster is fighting the record industry establishment and a pair of heavy-hitting music acts in court. In a case that has drawn international attention, the small software company is desperately trying to prove that it can keep hundreds of thousands of people from pirating rock band Metallica's songs on its service.

Beyond its economic consequences, the Napster phenomenon bears profound social implications. In only a few months since capturing the public's attention, the technology has raised legal, educational and even moral questions while changing the very definition of commercial entertainment and how people use it.

Hollywood braces for raid
For the major studios, it is the technological equivalent of a B-grade horror movie: Digital revolutionaries, emboldened by their initial successes in music piracy, threaten to undermine the film establishment once they can find roads wide enough to transport their spoils.

Arms race in PC software
The Napster revolution has quietly spread to computer software, posing grave danger especially to those companies that sell products directly to consumers. But the high-tech industry as a whole seems surprisingly sanguine, having faced piracy issues so many times before.

ISPs fight on both sides
The communications companies see themselves becoming latter-day video stores and record shops, reaping new profits as gateways to online entertainment. Yet the promise of fast Internet connections also increases the risk of piracy. How will these carriers handle this paradox?

Games may point to future
A blueprint for survival in the age of Napster can be found in the computer gaming industry, which has long been a target of well-organized pirates. The future may lie in radically uprooting the business models in fields as diverse as entertainment and spreadsheets.
 
 

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