In 1999, two university students decided to create a digital platform that allowed them to exchange mp3 files that could be downloaded for free. The program was dubbed Napster and immediately became a problem for major labels and musicians who had to deal with absurd levels of piracy and material being leaked months before its official release.
This state of affairs undermined the foundations of the music industry, as it allowed music lovers to get it from the Internet almost for free, and sales of music on physical media began to plummet. This caused a crisis among record companies and music distributors. These music industry figures couldn’t just sit back and wait for their business to be destroyed by the obscure students who created Napster.
The interests of musicians also suffered from the distribution of music via the Internet, who were forced to lose money due to the fact that their tracks went online for free. With access to free music content, most music fans would naturally not purchase physical music.
Rock band Metallica has filed a lawsuit against MP3 sharing software company Napster. This was at the beginning of 2000. Lars Ulrich, the band’s drummer and leader, issued a press release stating that his band considers sharing music over the Internet to be stolen goods because no royalty is paid for every copy of an MP3 file. Because the Napster program is designed for this type of transaction, the group said it should also be considered illegal.
It was against this background that Metallica drummer Lars Ulrich filed a lawsuit against the founders of Napster on March 13, 2000, going so far as to testify in the Senate on the Digital Music Committee to protect artists’ rights to their music and their content.
At the trial, Lars Ulrich stated that he heard the song “I Disappear”, recorded as the soundtrack to the film Mission: Impossible 2, on the radio, although at that time it had not yet been officially published.
Metallica’s lawyers claimed that the band was losing over $10 million. The cost is based on the amount requested by the US Recording Industry Association (Riaa) in a lawsuit against Napster: US$100,000 per pirated song.
Other American musicians such as the Goo Goo Dolls and the Offspring threatened to follow the path of Metallica. Rapper Dr. Dre, for example, warned Napster that if his songs were not removed from the system by April 21, 2000, he would also sue, which eventually happened.
Eventually, Napster went out of business as the government shut down the company due to a lawsuit filed by major labels, but prior to that, Lars Ulrich’s position had damaged Metallica’s image in the public eye for a while.
The court ordered Napster not to share copyrighted songs through the system. But Napster temporarily suspended operations while the company updated its database to support a new technology designed to force the system to work within the limits imposed. But the situation was not dealt with, so the service was forced to stop its work.
Metallica estimated the minimum damage suffered at $10 million.