July eleven to them. The Senate Judiciary Committee is holding a hearing on intellectual property, normally state affair, the draws the usual suspects like lobbyists and trade wraps and there air, but so are some of the biggest names in music. Throngs teenagers and twentysomethings line up early to get a glimpse of metallic as heavy metal, Drummer Laura's all Rick who, along with rapid Doktor Dray have become the faces The record industries charge against Napster also the eagles down heavily and land smaller said this hearing is becoming not only a debate over copyright infringement, it's also up public airing of artists, grievances against both Napster and the labels when Oryx speaks. He takes direct aim at naps

if you're not fortunate enough to own a computer, there's only one way to assemble a music collection, the equivalent of a Napster user theft. Walk into a record store grab what you want and walk out the differences. At the familiar phrase, files done now replaced by another familiar phrase: your honor, rest corner is singer Atlantis, more asset who tells amateurs because of the way labels structure, contracts, artist, rarely see royalties beyond their initial advance Napster. She argues. Sale can change that free internet distribution allows. The artist to aggregate an audience and created direct relationship without audience. This turns allows that artists to generate compensation through other outlets such as touring and merchandise, For the majority of artists, this amounts to making enough money to burn survival mode. When naps see Yo Hank bury speaks. He said when users sample music, they buy cds and that's a boon for the labels. He has an unspoken,

political message, two million of Napster users during an hour. voting age in conclusion say that we should not brandish thieves. The twenty million Americans who enjoy the Napster service instead, we should let history be our guide. Americans, love, music, every time. A new technology makes it easier for listeners to discover and joy. and share music, the recording and music. Publishing industries benefit and then there's something few could have seen coming Senator Orange Hatch, a Republican from Utah thanks of himself as an undiscovered talent, because well there's there oh baby. You heard that right, Hanukkah's Sean

and by the Mormon senior Senator from Utah Hatch, huge, there's this committee figures. His recordings could gain the most from a service like Napster. He see What many smaller artists C and Napster a platform that can get him heard without backing for the big labels that or in hatchet potentially serious both for the record industry. But the light Stone have their hopes pinned on a Senate committee much less a would be elderly pop star from Utah. They are to the courts. From wondering I'm David Brown, and this is business

In our last episode of Napster versus the record labels, then of downloads on the file company site exploded users were bending for fear. The cop right. Infringement lawsuit will end this bonanza and Napster. finally, snared of venture investment, firm, unafraid the pending lawsuit, but it's far from clear how Napster will whether the coming store? This is so five, a fatal email new, CEO Hank Bury knows better than to count on Congress to save Napster he's fighting on two other fronts as well, but he only needs one of the three to succeed. The second front the courts where he has just hired one of the world's poor, most litigators David boys who won the? U S: Justice departments Landmark Anti trust trial against Microsoft, but it's on the third front.

we're very feels most comfortable. The negotiating table, as a lawyer very did plenty of horse trading has a venture capitalist that is most of what he does So less than a week before the Senate, hearing varying lists is top partner. At his venture, firm John Homer because Hummer is not a Napster executive. It isn't as awkward for him to make making overture to the other side, plus He has a bit of fame. That comes with being a former mba basketball player. Hummer calls EDGAR Bronfman The ceo of Seagrim Company owner of the top record label universal music, The canadian air only recently moved his family's beverage company into entertainment, and he is more of a wheeler dealer than an old school media mobile.

When Hummer asks if he would meet him and bury before the showdown hearing for a preliminary injunction the following month. Bronfman says: yes: Bronfman flies, California and meets Hummer and bury inside the terminal of a small airports I think you're gonna lose in court. We got He called on the facts: the only reason I'm even willing to entertain a deal when we are so far ahead of the litigation is that if we keep fighting and you lose. Something even worse than you might come next, something what big name investors and lawyers and responsible people like yourselves in charge, bury nods and Bronfman continues so there's something in it for both of us right now is the time for a deal right now before it all blows up in court. man says Napster- has a great system for distribution, but they're here to be a way for people to get paid and that can

happen without charging per user per song were per month very agrees with him, but says they need to move incrementally after suddenly start charging users will bold and will take all the data about their tastes that the label could use with them. Marian Hummer promised to return with a proposal they can discuss next week at the famous annual gathering a media mobiles and deal makers in Sun Valley, Idaho, when they meet their rights when his brought along Sonys, Co C, o Noble Yuki day and Thomas Middle half. The young YO, a Bertelsmann. I made the soaring mountains and Sun Dappled streams. They sit for it For chat over coffee at the luxury retreat berry, starts off saying that Napster is prepared to offer the labels sixty per cent of the company middle half perks up

very glad to hear this Hank. You keep them with egg he's. for all of us. With that. Of control. The labels could what they wanted, including charging users there? Let's see, Yos can see things going their way, whatever happens in court, but then something strange happens a week later, as the injunction hearing approaches, Hummer calls Bronfman and says Some one is offering to buy Napster for two billion dollars, and then he adds that's the new price Berry hints that the rival bid is from a well then Brompton. Gets a call from Jerry Yang Founder of Yahoo. Huh Two says Napster told him to anti up two billion dollars to stay in the game. Bronfman smells a rat here.

Senses the berries overplaying his hand, modern by it they're bluffing us both Jerry. Rossman reminds Yang Aol is trying to buy time Warner in the biggest take over Time Warner. Only the Warner record label. I mean think about it. Jerry. Why would Warner brothers sign off on a deal that would put them under the same umbrella Napster and to do this when the rest of us are suing Napster? Do you really think AOL in Time Warner would risk the whole merger both Bronfman and Yang, walk No more talk. Evaluations are deal making the decisive between Napster and the labels will come in the courtroom. Well, prepared, judge has No time for fools linked in marketing solutions is the de facto

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in the federal building in San Francisco judge me in Hall, Patel resigning he will weigh the hour. I a motion for a preliminary injunction to shut Napster down. head of the upcoming trial to settle the dispute. Like such motions. It's an uphill battle for the party urging action, because it calls for a drastic step before all the evidence is in two hundred journalists and spectators had been lining up four hours, but the forty the court: room can't even hold all the lawyers for all the labels and the song publishers Rico Industry attorney rush Brackman is confident. His written brief is strong enough to sway the court on one of the two issues in play: That his side is likely to prevail on the legal issue at a later trial, so his opening arguments are aimed at the other issue, persuade the court that, without an injunction to stop Napster below

Those will suffer irreparable harm. Since the judge walked in several minutes ago. Thirty, forty, maybe fifty thousand recordings, have been downloaded using than after system now, if we take six months. Napster says it needs to prepare for trial. There will be three points billion, separate recordings downloaded using the Napster system and percent of those your honour, our copyrighted now the longer. This goes on the more possible, it will be for us and we believe for the court to do anything realistic when it's, amateurs turn David Bowe, is rises and immediately deploys the argument that save the vcr before the Supreme Court, specifically things that enable piracy are still permissible. If they have substantial legit uses, but Patel has immersed herself in the evidence assembled by the record label lawyers and Napster and in the mountains of material

is one damning email from Parker to Sean. It reads in art. Users will understand that they are improving their experience by providing information about their tastes without thinking that information to a name or address or other sensitive data that might endanger them especially since they are exchanging pirated music there it is Parker himself has scribe. What they are doing is pirating music. The Napster team is action and its attorney David boys, is about to get creamed. He rises to address the drug. We have it tat number two of the book that the court has a reference to a whole series of substantial non infringing uses off which Napster is capable and the court, is aware. The judge has little patience for boys approach,

What does that mean is capable, as opposed, is in fact, or has in fact in performing. later on, they say, pirating, be damned having piracy was uppermost in their mine. Am I not correct free music? people right parkers ill chosen words. killing Napster beforehand: berries own eyes, Battelle rubs boys five times toward the end, having too sadly conceded that the present day Napster network is flooded with copyrighted material boys reminds Patel that the beast Our decision allowed home copying but Patel, isn't buying the parallel they sharing it with the whole world. Patel orders a half hour break when she, turns and takes her seat? She shocks, everyone in the courtroom by mounting a decision instead,

reviewing all the arguments for weeks. All right Plenty of time has been spend it in preparing for the motion certain plenty of paper has been expanded as well the core is able to render a decision. Patel mythology we move through the undisputed facts and legal standards she ouch that most Napster users are violating copyright, and then she shreds Napster chief defence. She says that like the VCR makers Napster days aware of what its users are doing. I'm sure that anyone is clever. As the people who wrote the software in this case are clever. to come up with a programme that will help identify infringing items but turns to four when an asks when he would like the injunction to take effect, Brackman tries

Think of a way to say immediately without sounding vindictive. He stalls by walking towards the bench and as he does, Patel notices his glance at the wall. Now your honor right now and you're. Looking at the clock, not the calendar odd grins at the labels table, but boys complains that Appstore doesn't have a way to sort out unprotected material. Patel is a court on patients and shoots back about all those substantial non infringing uses. You are trying to convince me out. She who's that the injunction will take effect two days later Friday at midnight and she denies boys request for a stay while he appeals to the night circuit, with the sound of the gavel, reporters Sprint from the room and shot eyes to Europe

as he stairs down at his hands the Napster crew. dodgers, the media Piles and women can town car and drives off for the next two days Napster employees are frozen in a daze A natural recruiter send an email urging all of them to hang tide if the service shuts down not to look for jobs elsewhere in a way Casper Fans, Sean pledges. We will keep fighting for Napster and your right to share music in court fragmented You that without an immediate shut down, there would be an unfair Russia rush by users to loot with abandoned, while they still could and that six Actually, what happens in the two days? for the orders shut down the nuts. Or of registered users. Sores to twenty two million on the search engine Lycos Napster.

Comes the most sought word for the weak, ending a third week run by the word pokemon ways and his team frantically draft a longshot emergency appeal to the ninth circuit to stay the injunction Napster managers hop on a conference, call to go over what compliance will mean when midnight strikes the moment when judge held order goes into effect as they are speaking, order from the circuit appeals court arrives, the three member court will at this day, while the judge is consider legal issues raised by Napster and that could take as Napster. Rub sin shears company director in former NBA Centre, John Hummer strides through the office this Like the players, I wonder game and we won. The second

it's going to seven and we're gonna win it on Monday very sends an email to the troops, thanking them for sticking out through tough circumstances. Then he drops of bombshell Napster is trying to reach a settlement with the levels the arrangement could include advertising subscription or a hybrid of the two after last minute reprieve means that it will be in the spotlight for some time to come and that choice just things for the company and for those who have brought it this far Sean has become a bona fide celebrity. He spent more time on media interviews and playing online games, time coding number two thousand? He introduces Britney spears at the empty, be video musical wards. He does it while wearing a Metallica T, shirt, she's, already sold millions of albums and sold out auditoriums all over the world

here to sing a song older than she is its Britney spears. A model Sean graces, the cover up time magazine, but the er general gang is breaking apart. Jordan, Ridder quits later that much Parker is adrift too and devastated that is emails betrayed the company in court. He goes on a vacation to contemplate but he can do next Napster, but when returns very makes clear, he shouldn't be there at all, Parker resigns and remains tormented. Four months, though, his Sperience will later help him. Guidest start up its crucial early years, a little company called Facebook which will make him a billionaire Mary does go back to Brockman, but in a move that perplexes the canadian bearing

offers less than he did before Patel ruling. Now he owned Offers to sell fifty percent of Napster, not sixty percent and control. Brockman is stunned. He said specks the hidden hand of Intel Chair, Andy Grove silly and Valley Legend, who is sure that peer to peer technology is the future Grove. Probably urged Hummer not to give up a majority stake. He thinks Brockman pushes against berry and hummer business make any says you're losing in court, and yet you are offering less but Comer isn't budging. We have to stay in control. You want to wait attacks every individual transfer and its I went to work. Hummer might have wrecked, things even without groves help just as Talks were starting up again a fortune magazine story on Napster came out. One quote from Hummer leaped from the pay

I am the record industries worst nightmare. Bronfman is done. when he breaks the news to the other label bosses motion, were disappointed, but they understand they expect to win in court. But they also know that they ve lost something an opportunity to marry themselves to a new form of distribution. Before the pirates take over the world. For middle half. The young, CEO Bertelsmann, the whole game. He believes labels are missing, the point of Napster distribution is going to be peer to peer, legally or otherwise, and labels can either participate or get left behind. the towering button down German, has an apple for risk, so

He directs is e commerce cheap to secretly open a new back channel with berry next episode of Napster versus the labels, a Bertelsmann yield, the industry, the appeals, court strikes and a new player. moves in for the kill his name Steve Jobs, prom wondering this is business wars. We hope you enjoy this episode and we invite you to subscribe on apple pie casts Spotify. Google I guess. It's teacher, I heart radio or wherever you listened, a pod, casts there's a link on the episode notes. All you have to do is tapir swipe over the cover argue see it. You'll also find some offers more sponsors, and we hope you can support our show by supporting them. If you like what you heard, we'd love it. If you could give us a five star rating and tell your friends how to subscribe to another way,

Supporters is to answer a short survey, wondering dot com, slash survey and get to tell us what business war stories you'd like to here. Just a quick note, about the conversations that you ve been hearing. We can't know exactly what was said, but this dialogue. is based on our best research. I'm your! David Brown, Joseph Man, the author of all the raid, the rise and fall of Sean banning Napster wrote this story Karen Low is our senior producer and editor Jenny lowries on producer, sound designed by Bay Area, sound our exam get a pretty serious Marshall doing created by or Non Lopez for wondering here. Sinners. The beautiful liar is an incredible new narrative fiction, podcast, an unlikely superhero story, inspired

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