January 25, 2001, 12:26 PM — PEER-TO-PEER FILE SHARING service Napster announced an alliance on Tuesday with a Hamburg, Germany-based independent music label to promote a new membership-based business model under development by Napster.
The deal calls for edel Music AG to allow the master recordings and musical compositions it owns or controls to be used in Napster's membership-based file sharing service, according to officials at Redwood City, Calif.-based Napster.
As part of the agreement, edel will advise Napster on issues pertaining to the concerns of artists, songwriters, and record and publishing companies, Napster officials said. In addition, beginning in February of this year, selected edel artists will be promoted through Napster's Featured Music Program, which introduces new artists to Napster users.
Officials at Napster said the company has developed a new business model for a membership-based service that provides Napster users with high-quality file sharing while at the same time issuing payments to rights holders, such as recording artists, songwriters, and recording companies.
In October of last year, Bertelsmann and Napster formed an alliance to develop Napster's new file sharing service.
Separately, Napster is suing a company for the same type of behavior that has drawn legal action against Napster's music file-sharing service.
Napster representatives confirmed that the company last week filed a trademark-infringement lawsuit against Sports Service, which runs a Web site that sells items such as hats and T-shirts with the Napster logo. The suit was filed in U.S. District Court in San Francisco. Napster remains embroiled in its own music copyright infringement suit filed by the Recording Industry Association of America.