Today is the 10th anniversary of the debut of the original Napster, the game-changing peer-to-peer file sharing service created by Shawn Fanning. A perfect day upon which to reflect what’s happened in the world of music this past decade and think about the future going forward.
In 1999, music lovers around the world immediately embraced Napster. It had never been easier to discover and acquire new music. While the original Napster hadn’t thought through how to protect artists’ rights, the experience was about much more than “free music.” Napster was about putting the control into consumers’ hands so they could find virtually any song they could think of and, as importantly, they could easily discover and enjoy new music. It quickly became an ever-expanding, very exciting world of music discovery. And it changed the music industry and entertainment business forever – overnight. In virtually one instant, all of the power belonged to the consumer.
Ever since the demise of the original Napster, the industry, technologists and entrepreneurs have been playing catch-up with countless efforts to replicate the excitement of the original Napster within a legal framework. What was once relatively simple became very challenging, as the task of properly respecting artists’ rights and insuring payment to the individual rights holders is complex. And the industry spent too many years trying to lock and protect content instead of focusing on a great consumer experience. The imposition of DRM created a nightmare of interoperability challenges and a lack of portability. That, combined with no comprehensive catalog, further thwarted the healthy development of legal digital music.
While it has taken almost 10 years to create legal music services that deliver some of the fundamental qualities of the original Napster, happily a lot of great progress has been made. Consumers can, finally, legally buy an MP3 that can be played anywhere without restriction. When Napster re-launched as a legal service in the fall of 2003, we offered 500,000 songs. Today we offer over eight million and feature catalogs of the four major record label and thousands of independents. You can now also stream millions of songs on-demand from any web connection, delivering on the technology dream of “the celestial jukebox.”
We are honored to have had the opportunity over the past 10 years to try to solve this extraordinary and exciting challenge of delivering the world’s music catalog to music fans around the globe - while at the same time insuring the artists that create this beautiful world of music can make a living.
So – that’s where we’ve been. Let’s take a look at where digital music is today:
The prevailing legal business model today in digital music is the á la carte download store. We believe these types of music stores serve an important function as a place to purchase tracks, but they are not the best way to discover and enjoy music. Listening to 30-second clips and having to make a buying decision every time one wants to hear a song restricts the discovery and enjoyment of new artists and new genres. Whereas unlimited on-demand streaming services promote the discovery of new music and revitalize one’s enjoyment of music overall. When you add to this experience features such as genre, mood and topical playlists, programmed radio stations and automatic personalized playlist generation, the experience becomes a completely immersive one that enhances an individual’s music life. A complete music streaming service provides consumers with the “lean forward” experience of searching for music and organizing playlists, as well as the “lean back” experience of simply enjoying programmed music.
Over the last few years, free ad-supported streaming services have sprouted up all over the web, creating many buzz-worthy moments in the digital media world. While there are a number of interesting and useful free music discovery sites online today, most of them end up hobbling their services over time – with ads, play restrictions, poor bit rates and worse – deteriorating the original experience. Most challenging for these free services is that, as of yet, no service has “cracked the nut” and figured out how to create a profitable business model by giving away music for free. I believe a high-quality paid streaming experience is a great solution for many people, particularly since Napster was recently able to dramatically drive the price down to create an outstanding value. A great paid streaming experience like Napster provides high quality on-demand streaming without ads, play restrictions, poor bit rates and the like, and represents a great alternative to some of the pitfalls of the free services.
With Napster’s new offering introduced on May 18, we believe we bring the best of both worlds together. Five bucks each month gets you 5 MP3s that will work on virtually any device available – plus – a premium on-demand music streaming experience. It may have taken 10 years to do it, but this is the closest we’ve ever come to delivering on the free-wheeling discovery and enjoyment offered by the original Napster. Napster users can even share songs and playlists back and forth to continue enhancing discovery and making the experience a highly personal one. “My Page” customizes the Napster experience for users so they can enjoy their own personal version of Napster based on their actual interaction with the service. While we always have a lot more we want to do, we think Napster is in a great place right now.
As we think about the future, our bottom-line thesis is that we think it’s all going to be about unlimited, on-demand streaming. Downloads will of course continue to have an important role, but we as an industry have not even scraped the surface on how prevalent on-demand streaming will become. Once you connect Napster to your home entertainment system and have on-demand access to virtually every song you can think of, there's no turning back. Many of our customers can’t imagine life without it – and neither can we!
Thanks for dropping in. It’s been a very interesting and exciting decade in digital music – and I’m guessing there’s a lot of intrigue ahead of us as well. One thing for sure – music fans have never had more opportunities to discover and enjoy music.
So, as we begin now to look forward to the next 10 years, what are your thoughts about what we might see going forward? What do you think about music today? How do you see it evolving? What do you hope for in the future?