By Todd Pack, The Orlando Sentinel, Fla. Knight Ridder/Tribune Business News
Jul. 25--NEW YORK--Napster Inc.'s brand-new chief executive said Tuesday that an authorized version of the song-swapping service should be online by late summer, though he warned that won't happen unless the service can bear strict legal scrutiny.
"We're at a very critical point," Konrad Hilbers said on the final day of Plug.In, a digital-music conference.
In his first public appearance as Napster's CEO, Hilbers said he feels pressure to get Napster back online soon, before its former users "disappear into nowhere land."
But Napster's song-swapping service -- which once boasted more than 70 million users -- has been offline since July 2, when a software upgrade to prevent the sharing of pirated song files turned into a prolonged hiatus.
Shortly after Napster dimmed its site to make the upgrade, the federal judge who previously forced Napster to police its users said the company couldn't restart the service until its filtering system was foolproof. Her ruling was overturned on appeal, but Napster hasn't said when it plans to go back online.
It will be Hilbers' job to transform Napster from the scourge of the music industry into a legitimate business. He said tests of Napster's new song-filtering software are encouraging, but company executives still aren't satisfied.
Hilbers was appointed CEO of the Redwood City, Calif., company on Tuesday. He replaces the interim chief executive, Hank Barry, a lawyer who came to Napster from a venture capital firm to help it through its legal troubles. Barry will continue to serve on the company's board of directors.
Hilbers most recently was executive vice president and chief administrative officer of Bertelsmann AG's music arm, BMG Entertainment. Bertelsmann became Napster's primary financial backer in October.
BMG, EMI Recorded Music and Warner Music Group are partners in a proposed online service called MusicNet, which has a deal to sell songs eventually through Napster and other Web services.
MusicNet's interim CEO announced a deal Tuesday to sell songs from Zomba Recording Corp., a major independent whose artists include Backstreet Boys, Britney Spears and R. Kelly.
Rob Glaser said the service will go online in late summer.
It will compete with pressplay, a music service sponsored by Sony and Universal.
Edgar Bronfman Jr., executive vice president of Universal's parent, the French media company Vivendi Universal, said Tuesday at Plug.In that pressplay plans to launch by mid-September.
But the service still hasn't worked out a licensing agreement with music publishers, he said, and it won't launch with several key features, such as the ability for users to burn songs onto compact discs.
Experts say such features will be essential if the services hope to lure users from bootleg song-swapping services such as AudioGalaxy and iMesh.
Still, "I know pressplay will be a great success," said Bronfman, whose company owns Univeral Orlando.
Bronfman said Universal also is looking for a new kind of CD, one that would discourage or prevent music buyers from making near-perfect digital copies that can be shared over the Internet.
"The idea of putting out perfect digital masters doesn't make sense," he said.
Bronfman didn't disclose details, but several companies are developing CDs that can't easily be copied.
Neither service would discuss subscription fees, but analysts expect them to charge about $10 a month for a limited number of downloads.
"Nothing will prove to be as much a value "to consumers" as stealing someone's songs and giving them away," Bronfman said, but pressplay, like MusicNet, will emphasize its ease of use and reliability as well as promoting itself as a guilt-free way to get music online.
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(c) 2001. Distributed by Knight Ridder/Tribune Business News.
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