Napster Agrees To Charge Users For MP3 Service

Napster announced an agreement with German media giant Bertelsmann Tuesday, under which the music-sharing service will begin to charge its online members, funneling some of the profits to record companies and the artists that hold copyrights on the songs.

The agreement effectively ends the involvement of Bertelsmann subsidiary BMG in a lawsuit filed against the renegade company, although its effect on other major labels--and on a request made to Harvard to ban students from using the site--remains unclear.

BMG represents a slew of top acts, like Usher and the Dave Matthews Band.

Bertelsmann's chief executive officer, Thomas Middelhoff, said his company agreed to lend Napster a substantial amount of money to help finance the transition, and, in turn, will receive an option to buy a part of the company.

Bertelsmann officials also said they would try to convince the other litigants to cooperate with Napster.

Though details still have to be worked out, under one proposal, Napster would charge its users a $4.95 monthly fee.

While the new agreement may help to preserve Napster and legitimize its use, many Harvard students, part of Napster's core college-age demographic, considered the compromise a sellout.

"I think the original concept was great, but having to pay changes it all," Jonathan Y. Yu '02 said. "I wouldn't pay to use Napster."

"It's a way for them to get more money," Victoria M. Trendafilova '03 said. "I don't think I'm going to bother subscribing to it."

Others maintained that the agreement was warranted and fair.

"Since Napster was never turning a profit, it's clear that the fact that they are going to be forced to charge for music now means that they aren't in it for greed," said Benjamin G. Delbanco '02. "They are still a noble enterprise."

Others said that, although they use Napster, they recognize that ethical issues are involved.

"I think services like Napster probably did do damage to the record companies as people shifted from buying records to MP3s," Vincent Conitzer '01 said. "I think I would pay $5 a month if [Napster] remained the best service."

Whatever ultimately happens with Napster, students said free and accessible music may remain a reality.

"I think there's going to be some sort of free online distribution to eliminate CDs as a medium," said Matt Stearns '00- '01.

"If people can't distribute music freely from Napster, other services will step up, and the use of Napster will go down. I don't plan on paying for my MP3s," said Travis J. Schedler '01.

The agreement comes a month after Harvard and other universities decided to reject a request from a lawyer representing Metallica and Dr. Dre to block Napster access on their computer networks.

The lawyer, Howard E. King, has said in interviews that despite Harvard's response, he would still try to convince the University to restrict students from visiting the site.

"We're going to try to keep a dialogue with these universities, maybe point them to some authority that they've ignored or are not aware of that tells them they have a higher responsibility than just putting their heads in their sand," he said shortly after Harvard announced its decision.

King would not rule out legal action.

Last spring, King added five schools that allowed students to access Napster to a lawsuit against the service.

King could not be reached for comment about the Bertelsmann deal yesterday.

However, other major players in the battle against Napster began to soften their rhetoric, hoping the Bertelsmann deal would lead to an industry-wide settlement.

The New York Times reported that Hilary Rosen, president of the Recording Industry Association of America, said the Bertesmann deal was consistent with the music industry's position that artists should be compensated for their work.

Dean of College Harry R. Lewis '68 said that the ruling does not affect Harvard's policy on Napster.

"As far as I know, nothing that happened yesterday changes the fact that owners of the copyrights on some pieces of music contend that downloading that music using Napster is an infringement of their copyrights," Lewis wrote in an e-mail message.

University President Neil L. Rudenstine said that it is not Harvard's prerogative to enforce copyright laws.

"We do not want to ban Napster or anybody else," Rudenstine said. "We don't think it's our duty to police."

But he said he thinks it is important that there be some way to regulate the pirating of music.

"Otherwise, we're going to essentially stem the supply of artists," he said. "There has to be some way to have a fair use return to the artist."

Regarding the fee Napster decides to charge, Rudenstine said, "I would hope it would be modest."

--Parker R. Conrad and Josh E. Gewolb contributed to the reporting of this article.