A MARTÍNEZ, HOST:
The recording industry underwent a seismic shift 25 years ago.
(SOUNDBITE OF SONG, "...BABY ONE MORE TIME")
BRITNEY SPEARS: (Singing) Oh, baby, baby.
MARTÍNEZ: Britney Spears, the Backstreet Boys, Shania Twain. In 1999, album sales were at their absolute peak. Steve Knopper follows the industry for Billboard magazine.
STEVE KNOPPER: Everybody in the record business thought that this would last forever.
MARTÍNEZ: But on June 1, 1999, Napster was born - peer-to-peer file-sharing. My music collection can be yours with the click of a button. By the end of that summer, labels were freaking out. That's because the product they'd spent billions to produce was all of a sudden being given away for free.
(SOUNDBITE OF SONG, "...BABY ONE MORE TIME")
SPEARS: (Singing) Hit me, baby, one more time.
MARTÍNEZ: Knopper wrote a book about that sea change. It's called "Appetite For Self-Destruction: The Spectacular Crash Of The Record Industry In The Digital Age."
KNOPPER: Napster was sort of this underground thing. It was invented by Shawn Fanning at Northeastern University, in the Boston area. And people were sort of using it. Grateful Dead fans and people on message boards were kind of getting into it. And then all of a sudden, the Recording Industry Association of America started to look at this stuff online, and they went, oh, my God, and they thought it was like the locks being broken on all the record stores, and people were just looting all the music.
MARTÍNEZ: Yeah, and who were the artists that were mostly pushing back against what Napster was arguing?
KNOPPER: Yeah, there were a few very prominent ones. Most famously - or infamously, if you wish - is Metallica.
(SOUNDBITE OF METALLICA SONG, "I DISAPPEAR")
MARTÍNEZ: In fact, the band took their argument all the way to Washington, D.C. Here's drummer Lars Ulrich addressing a Senate hearing in 2000.
(SOUNDBITE OF ARCHIVED RECORDING)
LARS ULRICH: Earlier this year, while completing work on a song for the movie "Mission: Impossible II," we were startled to hear reports that five or six versions of our work in progress were already being played on some U.S. radio stations. We traced the source of this leak to a corporation called Napster.
(SOUNDBITE OF METALLICA SONG, "I DISAPPEAR")
ULRICH: Napster hijacked our music without asking. Our catalog of music simply became available for free downloads.
(SOUNDBITE OF SONG, "I DISAPPEAR")
METALLICA: (Singing) Hey, hey, hey.
KNOPPER: There were others, too. Eminem, Dr. Dre, many, many others kind of lined up behind the music business and said, you know, this is theft. We can't have this.
MARTÍNEZ: The recording industry sued Napster. So tell us about those suits. What happened?
KNOPPER: They were basically saying that Napster constituted copyright infringement. Napster's response to this in court was that they were just a vessel. They're like the telephone. It's just a device. They can't control what people say over the telephone. If people are committing crimes in their conversations, the phone company can't be responsible for that. However, one of the Napster people got caught because during the discovery process in court, he had been proven to have sent an email talking about all the illegal activity, including sharing music for free - which does constitute copyright infringement - that was happening at the time over the Napster service. And once the record industry attorneys picked up on that, my understanding is it was fairly easy to win the case, which they did. And Napster ultimately shut down.
MARTÍNEZ: I remember though, Steve, once that digital cat was let out of the file-sharing bag (laughter), so to speak, I mean...
KNOPPER: Right.
MARTÍNEZ: ...That was it. The record industry was about to topple, or things were going to change. So how is the recording industry doing now? Did it find a way to adjust?
KNOPPER: It took a while (laughter). The record industry initially responded to all of this disruption by basically stonewalling everything. They tried to put digital locks on all the CDs with copyright protection, and then they just sued. And they did this for four or five years, crucially without enabling their own service. Anybody who came to the record industry during this first early period of 3 to 5 years, roughly, anybody who was in the Napster position who said, we have a new model; we'd like to license our technology to the record industry so you can make more money - including Napster - the record industry, all the record labels, said, no, we're not doing that. We're just going to sue you. You guys are thieves. We will not negotiate with terrorists, kind of thing.
Eventually, it was Steve Jobs who met with all the executives at all the labels and said, hey, I've got this new thing. It's called the iTunes music store. And they kind of fell in love with it, and they also were losing their business and were desperate, and they fell into these deals with iTunes. Eventually, that evolved into first YouTube and then Spotify. And today, roughly since 2008, 2009, especially when Spotify clicked in the U.S. in 2011, the record industry has been doing very, very well.
MARTÍNEZ: And so artists - how have they fared since Napster? Are the deals better for them since Napster?
KNOPPER: Well, that is a more complicated question. I would say yes and no. I mean, Napster liberated artists in a way and then also YouTube and Spotify and so forth. The gatekeepers kind of collapsed. You know, for so long, in order to make a record and get your music to the world - to any sizable audience at all - you had to sign a deal with a record label, and that meant you had to sell your soul, and you had to (laughter) - you know, for many people, and you had to sign these kind of restrictive contracts. But once the internet came along, you could post your music any way you wanted.
So that was good for artists, but the problem was there's this signal-to-noise thing. If everyone's doing that, then that means it's harder for you to be heard, and then you do need a record label to kind of be heard. And, you know, that becomes the same problem you've always had. Additionally, now, with streaming, the rates for streaming pay artists such tiny, infinitesimal amounts that many, many artists are complaining that they can't make a living just from making albums or songs anymore. They have to tour, and then that becomes a whole different thing. That's more complicated and elaborate, and some people can't do it.
MARTÍNEZ: You know, here we are, Steve, 25 years later, and we've got a couple of generations that probably grew up expecting that their music has to be free. Like, they can't imagine the concept of buying a song. How has that sensibility changed since Napster?
KNOPPER: Yeah. I mean, I think for the most part, music has become free. However, there has been a little bit of a counterargument to that, which is that it's good to have physical material. It's good to pay artists. Music isn't free, and we see that in the ongoing resurgence of vinyl albums, which is something nobody expected. I was just interviewing somebody at a record store the other day who was saying, we had no idea this was going to happen, but we're very happy about it.
(SOUNDBITE OF SONG, "FORGOT ABOUT DRE")
DR DRE: (Rapping) And when your album sales wasn't doin' too good, who's the doctor they told you to go see?
MARTÍNEZ: Steve Knopper writes for Billboard magazine. He's the author of "Appetite For Self-Destruction: The Spectacular Crash Of The Record Industry In The Digital Age." Steve, thanks.
KNOPPER: Of course. Thanks for having me.
(SOUNDBITE OF SONG, "FORGOT ABOUT DRE")
EMINEM: (Rapping) Nowadays, everybody wanna talk like they got somethin' to say, but nothin' comes out when they move their lips, just a bunch of gibberish. And act like they forgot about Dre. Nowadays... Transcript provided by NPR, Copyright NPR.
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