NAPSTER

2 Pages 496 Words

The record companies can make as much or more money by abandoning their old business model and going with Napster's. They should look at the numbers, do the math, and then join with Shawn Fanning?s Napster. Then again, why do that when they can have both business models and make twice as much money? When Napster first started out, it had around 50,000 users, and as a music distribution service, there was nothing so exciting about it. The concept made no sense to the record industry, which saw it as a glorified bootlegging operation. But along with the MP3 movement, Napster introduced the notion of practical electronic music distribution, which appealed to early adopters and computer nuts. Once the lawsuits began, people saw a repeated free publicity for a littleknown product, thanks to media attention. Napster became a household name within months. But instead of the record companies dealing with 50,000 dedicated users making copies of their music, they now have to face over 5!
0 million. The The number of users and how this changes the money flow for the record industry was overlooked. The CD business is a $13 billion market. Of this $13 billion, a big chunk of money goes to distribution and manufacturing.
Meanwhile, many Napster users have said that they will pay up to $20 a month to keep this service alive. The company has suggested $5 a month for access. Exactly how many people would pay is unknown, but I suspect the numbers will be high. If the service were legal and ethical, I'm certain many people who aren?t sure about it would join. Adding special international servers and more specialized subsystems would also make a subscription model more appealing. With good marketing, more services, and legal, free trading of all content 24 hours a day, I think holding 50 million users is possible. I think $10 a month is the right fee. I'd pay it in a minute. If 50 million users each paid $10 a month, or $120 a year, for unlimited access...