By Joey Gardiner, 4 October 2000 09:30
NEWS Hank Barry, CEO of Napster, claims the fee would allow fair compensation for any revenues the music industry loses due to the controversial file sharing software. Barry made the comments at the close of the first day of the re-convened court case between Napster and the RIAA. "We could give the RIAA half a billion dollars in the first year of a deal. If you look at a membership model, and we start charging members say $4.95 a month you start to get some very interesting numbers," he said. The RIAA has not welcomed the idea though. Lawyer for the RIAA, Carl Sherman, reportedly told Reuters that nothing could stop the court proceedings now. Industry analysts agreed, claiming the record companies are unlikely to take Napster's overtures seriously. Graham Fisher, analyst at Bloor Research, said: "What has the RIAA got to gain from a deal? It wants to knock Napster out, so then sooner or later Sony or Warner can come in and steal the market." Peter Kumik, European MD of digital copyright company SealedMedia, said: "The RIAA wants to close Napster down. It wants to send the message out to venture capitalists that this kind of business model will not succeed, and stop them from investing in copycat companies." However, SealedMedia's Peter Kumik, said the big music labels should be considering digital distribution of music themselves. "The music industry has got to fundamentally change its approach to digital music distribution. It is interested in protecting its current business model, not innovating or changing." Last month, MP3.com was forced to pay Universal Music $250m compensation in a similar case. Napster currently claims to have over 20 million subscribers.
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