How Sean Parker Changed The Digital Music Industry
By: Austin Mullin
Tags: Napster, Steve Jobs, Spotify, Facebook, Sean Parker

Image Source: Entrepreneur

The way people download and share music would be changed forever when Sean Parker launched Napster in 1999. In the two years of Napster’s life, over 60 million users would use his service and demonstrate how convenient the internet could be in distributing music. Despite the legal issues of Napster, it established the possibilities for digital music. Sean Parker changed how people listen to music digitally.

When Sean Parker was 14 years old, he met Shawn Fanning. While both shared a love for programming, they also shared a fondness for music. Parker insisted on designing a program to share music with users, thus making music a more social activity. With Parker’s knowledge of programming, they developed Napster, a person-to-person file sharing service for music. With Fanning and Parker marketing the software as a person-to-person sharing service, music would never be stored on Napster’s servers. The servers would instead store an index of all users’ music libraries. When a user wants a specific song, Napster would search through its index to see if another user has that song. A connection is made with the user who has the song and is carried over as an mp3 file .

Napster’s P2P file-sharing service changed the method for how people download music online. However, Parker and Fanning’s creation would cause financial jeopardy for music distributors and record labels. Exchanging pre-purchased music files over Napster would not allow musicians to obtain the revenue they worked for. An example of this is when Metallica’s new song “I Disappear” was leaked and exchanged on Napster before its official release date. The lead drummer of Metallica, Lars Ulrich, sued Napster for copyright infringement. Lawsuits were also sent out by Dr. Dre and the Recording Industry Association of America (RIAA) for similar reasons.

The court stated that while Napster was not storing music in its database, the program was still causing copyright infringement in its networks. In addition, Fanning and Parker did have the power to prevent users from exchanging copyrighted music, but they did not interfere. Both Fanning and Parker were found guilty. Both were forced to shut down their P2P file-sharing service. Their company also had to pay $26 million for illegal music exchanges.

Despite Napster’s short-lived life, Fanning and Parker would influence other individuals to refine the digital music landscape. One of these people included Steve Jobs, founder of Apple. Observing the results of Napster, Jobs would set out to create his own service that resolves the legal challenges of music distribution. What Steve remembered from Napster was that people enjoyed the software, because the program made it convenient for the consumer to obtain certain music tracks. People did not want to go to the record store to buy an expensive album for just one song. These observations led to the creation of iTunes, a virtual music store that allowed users to buy multiple songs, without having to buy full albums. Thanks to iTunes being a paid service, it did not cause legal trouble and achieved great success. It refined how Fanning and Parker’s methods of handling digital music should be. This led to more virtual music stores being created. If it were not for Napster, we would not have virtual music stores available. Sadly, iTunes was built as a personal music store and did not have the social features of Napster to share music with others. Because of this, Parker still believed that there was still work to be done for the digital music landscape.

Following Napster’s closure, Parker and Fanning would split different ways. Fanning would go on to become an entrepreneur, investing in multiple startup companies. While Parker also became an entrepreneur, he also became the president of Facebook. At the company, he was introduced to a Swedish music-service called Spotify in 2010. Intrigued by the service’s possibilities, not only would Parker invest 15 million dollars into Spotify, but he also became a board member for the service. At the time, Spotify did not launch yet in the United States.

Parker wanted Spotify to be what Napster was originally supposed to be. The initial concept for Napster was to share music with others. However, the sharing of pirated music made it difficult to continue the service without dealing with legal issues. Spotify follows a similar concept but is now handled with a subscription service. Doing so would allow music labels to make a profit from the program. In addition, Parker found a way to link Facebook accounts with Spotify, making it easier to exchange music and playlists. The integration with Facebook was something that not only iTunes lacked, but other streaming services like Pandora were also missing.

Parker’s financial investments and technological advancements in Spotify were able to achieve the goals that Napster struggled to meet. From these programs, Parker was able to fulfill a need to exchange music in a way that was not inaccessible. If it were not for Parker’s involvement in these platforms, people would not be able to share music with users around the world.