In Search Of Napster II

Napster has been meeting with the big labels steadily, but except for the deal with Bertelsmann, it has not yet got to yes. Richard Parsons, co-chief operating officer of AOL Time Warner, a major music distributor (and parent company of TIME), told reporters earlier this month that he had yet to see an acceptable business model from Napster.

The music companies may have their own plans. Vivendi Universal and Sony Music are jointly planning to launch a subscription-based online music service by year-end. And there is the problem of getting consumers to pay. Many companies have tried to convert websites from free to fee; consumers generally respond by going from free to flee.

For now, the embattled Barry's biggest headache is still Napster's legal woes. The appeals court sent the case back to Federal District Judge Marilyn Hall Patel to issue a new order telling Napster exactly what it needs to do to clean up its act--and by when. If Patel's order forces Napster to start policing its site immediately, Barry says, it is possible that "we'll have no choice but to shut the system down."

This may explain the timing of last week's announcement of new architecture, which probably won't be ready for months. There is a long tradition in the software industry of releasing "vaporware"--illusory software announced just to throw off the competition. Napster's architecture may be a variation on the theme. Call it litigationware, real software designed to convince a court you're sincere about going legit. We should know any day now whether it worked.