AfterDawn: Tech news

Napster offers $1 billion to record labels

Written by Petteri Pyyny (Google+) @ 21 Feb 2001 6:48

After the court order in last week, Napster is desperate to find a solution to get it out of the situation where its only possibility is to shut down the service.
Napster on Tuesday offered to pay record labels Sony, Warner, BMG, EMI and Universal $150 million annually for five years in exchange for dropping their copyright infringement lawsuit. An additional $50 million would go to independent labels in each of those five years.

The money would come at the cost of free music. Napster envisions paying the record companies by implementing monthly subscription fees ranging from $2.95 to $9.95, a structure company officials said could be in place by July.

But the offer is not very likely to get labels to drop their legal processes.

"I think it would take a small miracle to get all five labels to agree to this," said Gartner analyst P.J. McNealy. "Some of these companies have other issues than just distributing the music."

Let's see how this saga ends..

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