April 4 2012 11:28 AM

Subscription-based music service—and former file-sharing pioneer—closes up shop

Photo illustration by Adam Vieyra

Napster, the insurgent file-sharing network-turned-conformist music service, has a small office on the third floor of a sprawling office complex in San Marcos. An architectural horror straight out of Office Space, the property sits off a road next to similar-looking office complexes.

When a friend and I visited on a recent Wednesday afternoon, the office had all the trappings of a freewheeling internet enterprise set to expire. A common area was furnished with brightly colored, plush chairs and a kid-size basketball hoop. But the blinds had been drawn, desks had been cleaned out and the place was empty except for two employees who didn’t seem to be in the mood for slam-dunks.

Late last year, rival music service Rhapsody acquired Napster’s subscribers and other assets from Best Buy, the company’s previous owner. Last week, Rhapsody made the final step in dissolving the brand, moving all of Napster’s U.K. and European accounts into its own system. Only eight employees remain at Napster’s offices in West Hollywood and San Marcos, says Rhapsody spokesperson Jaimee Steele. Napster’s small U.K. and Europe staff has moved over to Rhapsody, and about 100 U.S. employees have either taken new positions with Best Buy or been laid off. Christopher Allen, Napster’s general manager, says the U.S. offices are set to close by the end of April.

Of course, the original Napster—the pioneering peer-to-peer file-sharing network founded in 1999 by Shawn Fanning, John Fanning and Sean Parker—died off in 2001, after being crushed in a legal battle against the Recording Industry Association of America, a powerful trade organization. But software developer Roxio bought the brand at a bankruptcy auction in 2002, and revived Napster as an online service offering tunes for a paid subscription. Best Buy bought Napster for $121 million in 2008 and handed it off for a minority stake in Rhapsody’s stock.

It’s hard not to feel a twinge of sadness over Napster’s demise. When I was a high-school freshman living in the suburbs near University Towne Centre, the network served as my gateway into music geekdom, opening my ears to a universe of sounds that I’d never had access to via commercial radio and MTV. I was particularly enamored of bootleg live recordings, grabbing as many versions of Led Zeppelin’s “Communication Breakdown” as I could.

If anything, though, I feel embarrassed for the once-rebellious brand. Instead of letting the name die with dignity, Rhapsody is using Napster as the name of its U.K. and European service, propping it up like a marionette puppet that we’ll all invariably find ridiculous.

Had things gone differently, Napster might’ve developed into a record-industry juggernaut. In his book Appetite for Self-Destruction: The Spectacular Crash of the Record Industry in the Digital Age, journalist Steve Knopper writes that some media moguls had privately been open to a partnership with Napster, even as they publicly spoke out against it. In July 2000, record company executives met with Napster execs to talk business, but the brief meeting went nowhere.

Instead, most of the wealth from online music retail ended up going to the iTunes Store— which, as Knopper writes, helped Apple profit enormously off of the iPod to the detriment of major record labels. The new version of Napster competed with rival subscription services for a much smaller piece of the pie.

Matthew Bates, senior radio programmer at San Diego-based online radio service Slacker Personal Radio, sees Rhapsody’s acquisition as a matter of simple economics. The service now has more than 1 million subscribers, putting it in a better position to compete with Spotify, the Londonbased music-streaming service.

“For Rhapsody, it was just a customer-acquisition play to have bigger numbers,” he says.

Still, Bates can’t help but feel nostalgic for the good ol’ days. In his dorm room at the University of Nevada, Reno, he remembers cueing up tracks by obscure indie-rock bands like Joan of Arc and The Promise Ring, then waking up the next day with a handful of new songs. (Nowadays, all that could happen in a matter of seconds.)

Naturally, the war against illegal file-sharing continues to rage. In the months since the U.S. Justice Department shut down Megaupload, the popular file-hosting service, I’ve noticed a drastic decline in the number of free album downloads available via Google.

With the internet giving increased exposure to the ever-widening sonic universe, though, I’m finding it harder to justify rampant illegal downloading. I can’t blame radio or MTV or major labels for blocking me from good music anymore when I can buy everything from a Jimi Hendrix bootleg to the latest album by Bastard Noise on Amazon.com.

At Napster’s office in San Marcos, the two employees welcomed my friend and me inside but declined to speak on the record. Still, one of them didn’t think Napster’s dissolution was that big of a deal. After all, he pointed out, this wasn’t the original Napster. After we chatted for a few minutes, he handed us some stickers and sent us on our way. 

Email peterh@sdcitybeat.com or follow him on Twitter at @peterholslin.