Napster works because people who love music share and participate.
- Shawn Fanning
Serving as a computer programmer, serial entrepreneur and investor, Shawn Fanning was one of the famous teen that had a significant role in transforming the internet. At age seventeen, he created a program that made the internet a unlimited library of free music.
Napster was a phenomenon: millions of people signed in, and its popularity quickly skyrocketed to become a household name for music.
This was a prosper before the music industry declared war against the once was the biggest entertainment and technology companies on the planet.
Early Life
Shawn Fanning was born in November 22nd, 1980 in Brockton, Massachusetts. Born at the tail end of Generation X, Fanning was a teenage revolutionary in the first dot-com boom. Fanning dropped out of Northeastern University in Boston, and work closely with his uncle at his office in Massachusetts in 1998.
"For me personally, the fun part was when I was just a hacker," said Fanning. "I got my first computer when I was 16. It was a gift from my uncle."
Fanning is huge fan of video games. When he played one of his first games, The Legend of Zelda on the Nintendo Entertainment System console, Fanning started marking the major events of his life with video game releases.
"I wrote Napster when I was eighteen. There was no internet bubble at the time. My family thought I was playing games and messing around. They had no idea that I was diving into this completely new world. And it wasn't something I knew how to explain, because I was trying to make sense of it myself."
Creating Napster
Before the dot-com bubble bursts, the internet was already popular, but far from what it is today. Napster was originally created by Shawn Fanning in his dorm room at Northeastern University in Boston, where he was a freshman. It was not unusual for his to stay awake for days in front of his Dell computer.
He also wrote the Napster's source code on his uncle's sofa. When he was tired, he went down for a bowl of cereal and came back to his computer. He worked hard on it since at that time, Fanning was sure that someone else also had the same idea, and any day some software company could be unveiling a version of the same application, and then his big idea wouldn't be his anymore.
What Fanning did was combining the features of existing programs: the instant-messaging system of Internet Relay Chat (IRC, the file-sharing functions of Microsoft Windows and the advanced searching and filtering capabilities of various search engines. He reasoned that if he could write a program that included all those features, he can create a great piece of software.
But despite he was confident with himself, there was a huge leap of faith involved. Nearly everyone he mentioned the idea, they would respond that it won't work.
Fanning met Sean Parker after the two have similar interests: theoretical physics and hacking. Parker raised the initial $50,000 for Napster after Fanning pitched his idea. Fanning met Jordan Ritter through an IRC channel for computer hackers called #!w00w00. In May 1999, Fanning that initially refuced to allow the members to inspect his codes, began soliciting Ritter and several other w00w00 members for help. The members proposed fixes to the code, while a member Even Brewer managed the server's system.
Early June 1999, Fanning asked Ritter to fully take over development of the server while Fanning focused on the Windows client. A couple of months later, Yosi Amram invested $250,000 in Napster and required that the company operations to relocate from Massachusetts to California. Ritter moved to Silicon Valley in September 1999, and shared an apartment with Fanning and Sean Parker at the San Mateo Marriott Residence Inn.
With Fanning's and Ritter's programming skills and Parker’s entrepreneurial background, Fanning released Napster to public as a preliminary beta program in June 1999, while he was still a college student. The service was initially meant to be an independent peer-to-peer (P2P) file sharing platform, but since it's technology allowed files to be easily shared, participants can include files such as MP3s.
In the late 90s, MP3 files began to spread on the internet, thanks to the rise of Nullsoft's audio player Winamp, which was released in 1997. At that same year, the website mp3.com started sharing thousands of MP3 files created by independent artists for free. Because of its size, the audio format file was easily uploaded, shared and downloaded. While music can be easily "ripped" from CDs, which was previously nearly impossible, file sharing on the internet grows immensely rapid, especially by P2P file sharing.
As one of the very first file-sharing platform, Napster became a sudden success. MP3s populated most of its shared files. Although there were networks present at that time that facilitated the distribution of files across the internet, none was as user-friendly as Napster. At its peak popularity, Napster had gained 80 million registered users that were actively contributing to the service.
In just three short years, Napster launched a paradigm shift in the entertainment industry, spawning the likes of iTunes, Spotify, and even YouTube. Napster was also the first major web service that illustrated the immense power of the web by connecting and bonding strangers from around the world through the universal language: music.
Since people are enjoying in trading MP3s for free, more than 50 percent of internet network traffic consisted of MP3 file transfers. Napster's popularity made many of the original music owners worried, thus making it stumbled into concerns about copyright violation, which started on December 7, 1999.
It didn't take long until the service was shut down by court order. In July 2001, Napster shut down its entire network in order to comply. A few months later, Napster agreed to pay music creators and copyright owners with $26 million for past settlement, and another $10 million for future royalties. To come up with that amount of money, Napster was forced to convert its free service into a subscription service. This didn't come up well, and Napster's traffic was significantly reduced.
On May 17, 2002, Napster announced that it was going to be acquired by Bertelsmann, a German media firm, for $86 million. On June 3rd that year, Napster filed for Chapter 11 protection under U.S. bankruptcy laws, and on September 3, 2002, a judge blocked the sale to Bertelsmann and forced Napster to liquidate its assets.
After being liquidated, Napster survived, and was acquired by Private Media Group, while its brand and logos were acquired at bankruptcy auction by Roxio. Napster was then purchased by Rhapsody on December 1, 2011.
Other Ventures and Investments
Following his involvement with Napster, Shawn Fanning joined, and invested in, a number of early-stage technology startup companies. In 2002, Fanning co-founded a new company, Snocap, with Jordan Mendelson (Napster's Chief Architect), and Ron Conway. Fanning became the Chief Strategic Officer of the company that was meant to be an effort to legitimize his forays into digital media.
Snocap was initially founded to be a legitimate marketplace for digital media. But it was struggling early in its days. Snocap's partners, and the public, didn't receive it well because of its poor support and many technical issues. Snocap laid off most of its employees by the late 2007, and was later acquired by Imeem. At that time, Fanning was long gone from Snocap, and was already working on another venture called Rupture.
The Rupture project was announced in 2006 with seed funding. This third venture is related to one of Fanning's long personal passions: games. Fanning was officially made its CEO on October 2, 2007. Rupture was a social network designed to publish gamers' profiles to a communal space, and facilitating communication between World of Warcraft (WoW) players. Rupture was later acquired by Electronic Arts for $15 million, and Fanning started his career at EA.
It didn't take long until Fanning leaves EA since the company laid off a number of employees, which included him and his Rupture team.
Shawn Fanning with his knowledge and experience, didn't stop his venture just there. He started a new company called Path. In January 2010, Dave Morin announced he was leaving Facebook, at that time he was a Senior Platform Manager working with the social network. Morin left Facebook, and joined Fanning, and became CEO at Path.
In 2011, Fanning was reunited with Napster co-founder and friend Sean Parker. The two founded Airtime.com, and Fanning serves as its CEO and President, while Parker as Executive Chairman.
In 2013, Fanning co-founded Helium, where he serves as its Chairman. Fanning that is also an advisor at SuperFan and BranchOut, has invested in numerous startups, such as: ThreeSF, Sproutling, uBeam, Uber, Wavii, SimpleGeo and Square.
Personal Life
As a serial entrepreneur at heart, Shawn Fanning doesn't look back often on Napster. He has spent far too much time of his young adulthood in courtrooms and in the media spotlight defending the program he created.
"I was just so happy to be able to work on it and to have an impact. The experience was so rewarding and enlightening that the fact that it was shut down was really not even a huge blow for me personally. I felt like it was the beginning of many other opportunities," said Fanning that is now married and a father.
In the year 2000 when Napster was at its peak, Fanning appeared as a presenter at the MTV Video Music Awards. He appeared wearing a Metallica T-shirt with "For Whom the Bell Tolls" playing in the background. When he was asked where he got it, Fanning answered that "a friend of mine shared it with me." Metallica's drummer and founding member Lars Ulrich's was unhappy. Ulrich was the one who famously led the charge against Napster.
Fanning's fame with Napster has brought his featured in the cover of Time Magazine in October 2000. In 2003, Fanning had a cameo appearance, playing himself, in the 2003 film The Italian Job. In the film, Seth Green's character accused Fanning of stealing Napster from him while he was napping in their Northeastern University dorm room. In the early 2008, Fanning appeared in a Volkswagen commercial directed by Roman Coppola. Fanning and Napster were the subject of Alex Winter's documentary Downloaded in 2013.