WHEN BLANK TAPES were first introduced, the panicked cry was that they would destroy the music industry. Who would buy an album when they could copy it for free? It'll bankrupt the labels, people said. That was almost 20 years ago, and the labels are far from bankrupt, because when you tape an album you wouldn't otherwise pay for, it helps the artists as often as it hurts. If they're any good, odds are you'll end up buying their other albums, going to see them live, and generally giving them money. If they're no good, you'll probably tape over the album, and no harm is done. As revolutionary as MP3 software seems, it's just an update of the same principle. Napster turns your hard drive into a blank tape.

To date, the Napster debate has been split into two camps. On one side are those like Metallica's Lars Ulrich, who believes that trading MP3s online steals money from artists and labels, and could bankrupt the recording industry.

In the other corner is Napster itself, which is sticking with the defense that its software allows unsigned artists' works, and other legally distributed recordings, to reach a far larger audience than ever before.

As for Napster's virtuous claim that they merely exist to give unsigned bands a voice, I happen to be in an unsigned band; we have MP3s up on the web--and, surprising as this may sound, far more Napster users type in "Metallica" than "Runaway Weiner Dog." Like MP3.com, Napster puts bands out there, but it doesn't draw anyone to them. Let's face it: People don't use Napster to discover new music, they use Napster to get ahold of songs they already want.

So, if both sides are wrong, then who's right? As always, the last person you'd expect. Speaking to the Digital Hollywood online entertainment conference in New York last month, Courtney Love made a point no one has brought up yet: Napster can't steal money from artists, because the labels have already stolen it all.

Love broke down in detail where the money made by album sales goes, and based on a similar breakdown done by Steve Albini in The Baffler several years ago, her math seems pretty good. Before an album's release, the band incurs the costs of recording, studio time, producers, engineers, a manager, a lawyer, a business manager, independent radio promotion (read: payola), and of course, taxes. The money for all this comes from the band's label advance, which is essentially a loan, owed to the label by the band. The label assumes no risk; the band adopts all the financial burdens.

Even assuming that the record sells, the band's cut (usually around 10 percent) barely covers their mountain of expenses, while the label's 90 percent of the profits is virtually untouched.

This isn't some paranoid persecution fantasy on Love's part. Because the four majors have a virtual monopoly on the avenues of distribution and promotion, the artists are at their mercy. Therefore, if an artist makes any money at all, it's not from selling records; it's from touring and publishing rights. Maybe if you sell as many records as the Rolling Stones, royalties start to pile up, but Mick and Keith make a hell of a lot more money playing stadium shows, not to mention selling "Start Me Up" to Microsoft (which used the song to advertise the fact that its operating system is so twisted that you turn it off by using the "Start" menu).

So when a record sells big, the label stands to gain financially, and the artists gain because it broadens their fan base. The more people who own a band's music in any format, the more people will be inclined to go see the band on tour, the more money the band will make in ticket sales, and the more likely the band's songs will end up in a Nissan commercial or the next Batman movie. And if a million people pay $17 for the latest album by Hole, or Metallica, or whoever, how many more would download it for free with Napster? Plenty.

The artists lose some royalty money, but gain some ticket revenue. And for many bands, the gain could very well outnumber the loss. Whether artists put up MP3s, or fans bootleg and trade their music online, the bands broaden their fan base and the labels don't profit from it. Essentially, Napster is at worst a break-even proposition for the artists. It's the labels who are the big losers in every Napster scenario.

Conventional wisdom says that, for better or for worse, Napster is going to change the music industry. But from the artists' perspective, there is no "for worse." Virtually any situation would be preferable to the current one, in which labels own a songwriter's work indefinitely, and reap most of the rewards of the artists' labor.

And while the labels are currently crying foul, and suckering the likes of Metallica into swaying public opinion on their behalf, you can be sure they're working on a way to use Napster to their advantage. American ingenuity is such that no invention can't be made profitable. Just as they survived blank tapes just fine, the labels will ride this one out and probably end up making more money than ever.

The real losers could end up being the indie labels. As it is, labels like Kill Rock Stars, K, and Merge exist because an alternative is needed to Sony and Universal--bands who can't or won't succeed on a major turn to an indie to get their music out there. If Napster, or something similar, provides an easier, more financially advantageous alternative to a major-label contract, bands who would otherwise sign to an indie will probably take that route instead.

On one hand, it's a real shame. Indie music has provided a far more vibrant culture over the past 20 years than the corporate-owned music industry could ever hope to. But if indies are rendered obsolete by web-oriented self-sufficiency, indie culture will surely follow indie bands onto the web. Isn't self-sufficiency what labels like Dischord were all about in the first place?

Of course, while it's easy to speculate about these changes, the revolution is still a long way off. While college students and white-collar office drones have the ready access to high-speed connections that make Napster worthwhile, plenty of people don't. Throw in people who won't try to figure out how Napster works (downloading music may seem easy to you, but try talking your parents through it), and you've got a pretty big audience for music that you don't have to spend time online to own. As ever-present as Napster seems, as much press as it's getting, and as much as you hear about MP3s replacing the CD by year's end, web junkies always forget one important fact when they wax poetic about the latest online development: Not everyone is a web junkie.

Even when MP3s are the norm, labels big and small will find a way to make money from distributing music in any form. If they don't, the people who support independent music by starting labels will go on supporting it in other ways. And the people who make money from mass-produced music will move on to mass-producing something else.

The major labels are trying to draw on public sympathy, and prey on fear that they could be brought down by Napster, but so what if they are? Will anyone but Lars Ulrich miss his label when it's gone? Are the people who rob our favorite bands blind really deserving of our sympathy?

It doesn't really matter, because sympathy doesn't make the law. Money does.

In a recent "technical amendment" to a broadcasting-related bill, the Recording Industry Association of America (RIAA), who lobbies on behalf of major labels, managed to legally define recorded music as "work for hire." What that means is that the company completely owns the employee's work. When an employee of General Foods writes the word games on the back of the Frosted Flakes box, that text is owned by General Foods, not the writer. Apparently, the same now holds true for every lyric on the new Busta Rhymes album. According to the law, what he wrote is the property of his label, forever.

Courtney Love also brings to our attention the fact that the amendment was added to the bill after the Congressional hearings on it were over. We all know from Schoolhouse Rock how a bill becomes a law: Both houses of Congress okay it, they pass it to the President, and if he signs it, it's a law. But if Love's allegations are true, there's now an intermediary step, in which after Congress has okayed a bill, corporate lobbyists step in and rewrite it before it lands on Clinton's desk.

If this is now the law of the land, then artists are more screwed than ever. But as it is, the only reason the corrupt label system has existed for so long is a lack of other options. Whatever options technology provides, and it's providing them fast and furious as of late, more and more artists are going to start taking them. Napster may not be as powerful a force for good or evil as people would have you believe, but if it gives artists any more leverage against being so completely exploited, then more power to it. As it is, artists as diverse as Public Enemy and Kristin Hersh have taken to selling their music online, with some success. It's only a matter of time before someone finds a way to turn Napster to their advantage as well. Hell, Napster is supporting the next Limp Bizkit tour.

And no matter how many laws the RIAA buys, Napster will survive. If one teenage hacker who wanted to trade music with his friends can put the entire recording industry in such a tizzy, taking on Lars Ulrich should be a piece of cake.

An unabridged transcript of Courtney Love's speech can be found at www.salon.com/tech/feature/2000/ 06/14/love. The S.1948 Intellectual Property and Communications Omnibus Reform Act of 1999 can be found on the Congressional website at thomas.loc. gov/cgi-bin/query/D?c106:1:./temp/ ~c106yq0wue::. The technical amendment in particular can be found at thomas.loc.gov/cgi-bin/query/ D?c106:1:./ temp/~c106yq0wue:e73282:.

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