The kid who sparked the digital music revolution says he's back to finish the job. As a college student in 1999, Shawn Fanning created Napster the file-sharing software program...

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The kid who sparked the digital music revolution says he’s back to finish the job.

As a college student in 1999, Shawn Fanning created Napster the file-sharing software program that let millions of people illicitly trade copyrighted songs over the Internet.

Now, three years after the courts shut down Napster, Fanning unveils Snocap, a San Francisco company that has developed a technology to make file-sharing legal.

The record labels that put Fanning out of business now are signing deals with him to power a new generation of file-sharing services that debut early next year.

Universal Music, for instance, has licensed its 150,000-song catalog to Snocap. The company’s technology allows music lovers to buy songs the record labels have authorized to be distributed over file-swapping networks. Such networks allow people to share online songs and other digital files that are on each other’s computers.

“As consumers ourselves, as people who love music, it will enable a very radical change in the market,” said Fanning, wearing his trademark baseball cap at Snocap’s offices in San Francisco. “The whole second half of Napster was a really difficult time for many reasons. And it was hard, particularly seeing all this potential and not being able to realize it.”

That gnawing sense of a vision half-fulfilled spurred Fanning to create Snocap. What was needed, he said, was an intermediary who could be trusted to protect the interests of the music industry and the technologists who created Napster’s file-swapping progeny.

Fanning drew upon some surprising allies to make headway with Napster’s staunchest adversaries: the record labels.

Quincy Jones, the musician, composer and producer, had befriended Fanning during Napster’s heyday and embraced the technologist’s vision.

On a visit to Jones’ home, the impresario advised Fanning to hire a well-connected entertainment lawyer to begin making introductions with the label executives.


That the doors opened to the music industry’s one-time archenemy speaks to the record labels’ failure to quash file-sharing since it shut down Napster.

Kazaa and other file-sharing services that arose in Napster’s wake have survived years of litigation by the industry and are used by more than a hundreds of million people worldwide.

Universal Music executive Larry Kenswil said his record label has been trying for years to launch legitimate versions of file-sharing. But the challenge has been to find a way to make the popular networks legitimately profitable businesses — not ones that make money selling ads targeting a vast audience attracted by the lure of free songs.

“The potential here is you’ve got a lot of people using peer-to-peer,” said Kenswil. “If they can be converted to using [licensed] systems that are just as easy to use … then there’s a big upside.”

It’s a conclusion born out by the music industry’s consultant, NPD Music and Movies. It found that licensed stores sell about 10 million songs in a typical month. The peer-to-peer networks, by contrast, distributed around 230 million songs in the same time.

“Nine out of 10 peer-to-peer households have not yet tried a legal service,” said NPD Music President Russ Crupnick. “It still says the vast majority of peer-to-peer users have not yet either been convinced or have been promoted to, so they’re not even trying a legal alternative.”

At loggerheads

The record labels have been unable to tap into the larger file-sharing marketplace, in part because negotiating with the big, established networks would undermine the industry’s sue-the-pirates-into-oblivion legal strategy. And the file-sharing networks have been unwilling to accede to the labels’ demands to filter out copyrighted works, because it would undermine their legal defense and chase away all the users.

Fanning hopes Snocap will end the stalemate. He created a independent platform where music labels and garage-band acts alike can come and register ownership of their songs. They lay out a set of rules for each track, specifying whether it can be traded freely on file-sharing networks or whether they must be purchased.

Unlike the original Napster or Kazaa, Snocap’s software identifies every new song someone puts on their computer to share with others on a file-sharing network and prevents the unauthorized swapping of copyrighted songs.

Snocap uses each track’s acoustic properties to assign it a unique “fingerprint” and attaches the rules for the song.

When someone adds a new song to their shared music folder, Snocap attempts to identify it. It makes a fingerprint and checks it against the list of songs in Snocap’s song database. If it finds a match, Snocap sends back a signed “certificate” with rules that determine whether it can be shared and at what price.

Enter Mashboxx

Snocap’s technology debuts early next year on Mashboxx, a licensed file-sharing service that will launch early next year.

Mashboxx also will attempt to satisfy a music fan’s musical appetites by distributing a sample song that they can listen to and ultimately be prodded to buy.

“Our general approach is that we want to create a safe haven in which the clear advantages of file-sharing can be preserved, while also protecting the rights of content holders,” said Stephen Taylor, Mashboxx’s head of product development.

But some observers doubt Fanning will be able to win back the tens of millions of people he hooked on free music with Napster.

In a recent interview, Michael Gartenberg, research director of Jupiter Research in New York, expressed doubt that licensed file-sharing would appeal to file-swappers.

“Creating peer-to-peer technology for users to share protected files that have to be purchased isn’t going to change the landscape dramatically,” he said.

Fanning is unfazed. “We were all prepared for this to be a marathon and be a very long-term thing,” he said.