The Emergence of Napster and P2P File Sharing in 1999

Napster founders Shawn Fanning and Sean Parker in 1999; via trailer for 'Downloaded', a 2013 documentary by Alex Winter.

On December 6, 1999, the Recording Industry Association of America (RIAA) sued Napster, the first major MP3 file sharing platform of the internet age, for contributory and vicarious copyright infringement. It was a flashpoint between the cultural industries and the internet startups that had dared to challenge decades-old institutions like Universal Music Group, Sony Music, and Warner Music Group.

The fact that the lawsuit arrived right at the end of the twentieth century was apt — the online future was an existential threat to those analog-based record companies. The “majors” would eventually adapt, but they needed more time to do it.

Napster was a software program you downloaded onto your computer, which allowed you to search for MP3 files on the computers of other users. If you found the latest Nine Inch Nails or Limp Bizkit album — and you easily could — you could download that to your computer via peer-to-peer (P2P) technology.

Napster software, 1999; via Reddit.

The MP3 file format itself was relatively new, and was fast becoming the standard for digital distribution of music. This wasn’t the RIAA’s first dance with MP3 — the previous year, it had sought an injunction against Diamond Multimedia to stop the impending distribution of its new “Rio” MP3 player. The RIAA lost that fight, partly because the Rio was one step removed from any form of copyright infringement (you couldn’t download files from the internet directly to the Rio; there had to be an intermediary computer).

Napster’s software was much more direct — it essentially enabled the transfer of MP3 files from one computer to another, via the internet. The RIAA had realized that Napster’s easy-to-use web interface combined with the upcoming mass rollout of broadband was a potentially lethal formula for the music industry. The leading Main Street music retailers, like Tower Records and Sam Goody, were heavily reliant on CD sales — as indeed were Internet retailers like Amazon.com and CDNow. Napster would potentially undercut all of it.

Prior to Napster, (legal) MP3 download sites had very limited choices. These were the top tracks on MP3.com in February 1999 — Beethoven, number one with a bullet!

The First Major Online Download Album

Coincidentally, the release of David Bowie’s latest album, hours…, was also making online history that year: it was one of the first albums by a major artist to be released as an online download over the Internet.

On 21 September 1999, Hours was made available for purchase on the websites of Virgin Records and “participating retailers,” a full two weeks before the CD was released in record stores. “The music from hours... will be downloadable in the Secure Digital Music Initiative (SDMI)-compliant formats Liquid Audio and Microsoft's Windows Media,” announced Virgin Records America in a press release on August 30.

Rolling Stone story about the Hours download; August 30, 1999.

SDMI, as The Sunday Times reported in an accompanying article, “ensures that the music can be played only on the computer of the person who has paid for it, preventing the free distribution of music through the Internet.” Basically, it meant that anyone who bought Hours during that two-week online window would not be able to transfer the album onto a CD, or even an MP3 player (these devices, like the Rio, had started to come onto the market by 1999).

New York Times article about music e-commerce on 22 September 1999, which led with Bowie: "Mr. Bowie is the most well-known artist trying to sell — for about $18, the list price of a compact disk — a full-length recording in a download format providing copyright protection."

Bowie himself seemed to embrace the digital download experiment, based on airbrushed comments he made in a press release. It’s worth quoting the whole thing, to get a sense of how new music on the internet still was at this time:

“I couldn't be more pleased to have the opportunity of moving the music industry closer to the process of making digital download available as the norm and not the exception. We are all aware that broadband opportunities are not yet available to the overwhelming majority of people, and therefore expect the success of this experiment to be measured in hundreds and not thousands of downloads. However, just as color television broadcasts and film content on home video tapes were required first steps to cause their industries to expand consumer use, I am hopeful that this small step will lead to larger leaps by myself and others ultimately giving consumers greater choices and easier access to the music they enjoy. This can only be of benefit to the consumer."

Whichever PR flack had advised Bowie to keep expectations low for the number of online purchases, they were proved correct. In the November 24 edition of the Wall Street Journal, EMI chairman Eric Nicoli confirmed that just 1,000 copies of the album were bought and downloaded over the internet in the two weeks before its CD release. A Billboard report dated 13 November 1999 put the number of downloaded "units" more precisely: 989.

Billboard, 13 November 1999; via Google Books.

"Mark my words...we are not going back to record companies and through shops," Bowie told Billboard. Although he was ultimately wrong about that, Bowie was right that downloading music online would soon become a major trend. Perhaps not in the way he'd imagined, though.

Napster had been quietly launched in May 1999. As always, Bowie’s fans had been among the first to notice this new form of online music distribution. In a July 17 posting on the alt.fan.davidbowie newsgroup, a fan posted this message:

“Just came across this programme called Napster. You can download it free from www.napster.com. Basically it's a library of mp3 files that the users share with each other. Last night there were over 26,000 files available from over 180 users. There is an inbuilt search facility for Artist and Title. There were about 30 mp3 files for Bowie when I looked last night.”

By the time Hours was released in October, there were 4 million songs in circulation on Napster. It didn’t take long for Hours to be added, making it available for free download by anyone else who had installed the Napster software. So much for SDMI — Pandora’s box was now well and truly opened on digital downloads.

Napster website, November 1999; via Wayback Machine.

Just Another Search Engine?

The creator of Napster was Shawn Fanning, who had just turned 19 years old when the RIAA came knocking in December 1999. At the time, he described his creation as “a real-time search engine.” And just as social media products in the future would insist they weren’t responsible for what users did on their platforms, Fanning tried to downplay the responsibility of Napster in policing music copyright.

“We were providing a search engine which allowed you to find files, which were indexed on individuals computers, but we were not actually providing the files themselves,” he later said. “We were facilitating the transfer between those two parties.”

Napster search circa November 1999; screenshot via Napster.

Even many years later, Fanning and his business partner, Sean Parker, insisted that Napster was just another search engine. “Look, we never touched the content ourselves,” Parker said in a 2013 interview with Billboard. “We were just an index. We operated no differently than Google or Alta Vista.”

The problem was, although Google or Alta Vista occasionally pointed to pirated content in 1999, the vast majority of their indexes pointed to perfectly legal web pages. Whereas with Napster, it was almost always pointing to copyrighted files. Those files would become pirated content as soon as they were transferred from one person to another, which Napster enabled.

A Napster user's library circa November 1999; screenshot via Napster.

Fanning and Parker, who were both teenagers when they started Napster, had no idea what they were getting themselves into. Because it wasn’t just the music industry that was aghast at this new P2P technology, but the wider entertainment industry too. The New York Times reported in March 2000 that the RIAA vs. Napster case was “being closely watched by television and movie executives, who see it as a glimpse into the future of their industries.” Even then, music was seen as the canary in the coal mine:

“While high-quality video files are currently too large to be sent quickly over most Internet connections, high-speed — or broadband — services will soon expose other media to the opportunities and threats posed by digital distribution," stated the NYT report.

Following the RIAA’s lawsuit in December, Napster’s growth “became epidemic on college campuses that offered free high-speed access from dorm rooms,” wrote Joseph Menn in his 2003 book, All the Rave. This, more than anything, showed that the future of music distribution was going to be Internet-driven. The younger generation were already hooked and there was no stopping the momentum.

Salon's report on 17 November 1999 that the RIAA planned to sue Napster.

Even if the RIAA could stop Napster, there were a slew of competitors emerging. Fanning was particularly worried about Gnutella, a new product being worked on by another young coding sensation, Justin Frankel. Already well known for building Winamp, a popular Windows media player that was sold to AOL in June 1999, Frankel had now set his sights on creating a P2P music distribution system that would be more decentralized — and thus safer from prosecution — than Napster. As Menn told it, when Fanning found out in late December what Frankel was working on, he ran into the Napster office and shouted, “Justin Frankel’s working on something that’s going to blow us away!”

An Alien Life Form

By the end of 1999, there was a sense that the internet was about to blow away some of the most valuable business models in the cultural industries — starting with music, but most likely quickly spreading to other forms of entertainment.

David Bowie never mentioned Napster in any of the interviews he did during this time (as far as I know), but he was convinced of the disruptive power of the internet. One of his shticks in interviews over 1999 was to say that if he was a young man now, he would start a career on the internet rather than in music. The BBC’s Jeremy Paxman took the bait in a Newsnight interview aired on 3 December, 1999.

David Bowie on Newsnight, BBC, December 1999.

“You said if you were nineteen, you wouldn’t go into the music business?”

Bowie replied that he’d become a musician in the 1960s “because it seemed rebellious, it seemed subversive, it felt like one could affect change to a form.” But now, on the cusp of the 21st century, the internet was doing that.

“The internet now carries the flag of being subversive, and possibly rebellious, and chaotic, nihilistic,” he said.

Bowie was nearly 53 when he said this, but he looked as youthful as ever — shoulder-length strawberry blond hair, carefully crafted sideboards and a hint of a goatee, purple-tinted John Lennon glasses, and an olive-green and aqua-blue patterned shirt (top button undone). It was a marked contrast with his interviewer, Paxman, who had greying hair, conspicuous wrinkles around his eyes, and wore a navy blue suit and tie. What’s more, every time Paxman mentioned the internet, his face would scrunch up into a look of extreme skepticism.

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Ironically, Paxman was actually a few years younger than Bowie — but it was obvious which one of them was more attuned to what was happening in the culture. Paxman just couldn’t seem to grasp the significance of the internet.

“You don't think that some of the claims being made for it are hugely exaggerated?”

“I don't think we've even seen the tip of the iceberg,” replied Bowie. “I think the potential of what the internet is going to do to society, both good and bad, is unimaginable. I think we're actually on the cusp of something exhilarating and terrifying.”

“It's just a tool though, isn't it?” said Paxman, still disbelieving.

“No, it's not,” Bowie said. “No, it's an alien life form!”

How right he was. As the 21st century dawned, Ziggy Stardust — Bowie’s most famous personification of an alien — was no longer interested in playing guitar. Now, Ziggy ran a web portal and swapped MP3 files with Weird and Gilly.

Napster homepage, early 2000; notice the added legalize. Via Wayback Machine.