STEVE INSKEEP, host:

You know, it's been almost 10 years now since Napster turned the music industry on its head. The file-sharing service allowed fans to freely exchange music on the Internet. And since then, CD sales, along with record-company profits, have plummeted.

This morning we're going to wrap up our series on the free world, on the Internet, with this report from NPR's Laura Sydell.

LAURA SYDELL: The music industry has been taken down by free. Check this out. In 2000, 'N Sync's "No Strings Attached" was top of the Billboard charts.

(Soundbite of song, "No Strings Attached")

'N SYNC (Pop Group): (Singing) But if you want it, here's my heart, no strings attached.

SYDELL: The group sold nearly 2.5 million CDs in one week. Last year, it took only a million CDs for Lil' Wayne's album to reach the top of the charts.

(Soundbite of song, "Phone Home")

Mr. LIL WAYNE (Musician): (Singing) We are not the same I am a Martian, and I'm hotter than summer rain like Carl Thomas.

SYDELL: Music industry revenues have dropped by half since Napster came to the scene. Attorney Don Passman, who's represented major recording artists, such as Janet Jackson and REM, says even fans of the biggest stars aren't paying for music.

Mr. DON PASSMAN (Attorney): You can't compete with free. It's very difficult to sell a product if everyone can get it for free.

SYDELL: But Passman thinks if fans keep this up, the quality of music is going down because no one will be able to make a living as a professional musician. In this era of the Internet revolution, Passman looks back to a different revolution, the French one.

Mr. PASSMAN: They not only lopped off the heads of Louis and Marie Antoinette, they also did away with the copyright law.

SYDELL: For several years, the French could get books for almost nothing and authors had a hard time making a living.

Mr. PASSMAN: And what happened is that three years later, the French government reinstated the copyright law because they realized that for artists to be able to survive, they have to be able to make a living from their work.

SYDELL: Today in the United States, we have copyright laws - they've just become more difficult for the record labels to enforce. Over the last decade, the recording industry has filed thousands of suits against alleged file-sharers, most of them settled out of court. Sure, iTunes sold 2 billion songs last year. But compare that to the 15 billion songs that are downloaded illegally every year according to the research firm, BigChampagne. Chris Anderson, the author of "Free: The Future of a Radical Price," thinks the traditional music business is a bunch of whiners.

Mr. CHRIS ANDERSON (Author, "Free: The Future of a Radical Price"): As you go through the process, trying to figure out what the new model is, often the voices of the losers are heard most loudly because they're feeling it so profoundly while the winners have not yet emerged.

SYDELL: But there are some winners emerging. They just aren't necessarily high-profile. Take an artist like Jonathan Coulton. He writes songs about life as a programmer.

(Soundbite of song, "Code Monkey")

Mr. JONATHAN COULTON (Singer-songwriter): (Singing) Code Monkey get up get coffee, Code Monkey go to job, Code Monkey have boring meeting, with boring manager Rob.

SYDELL: On the Internet, Coulton found the right audience for his music by giving his songs away.

Mr. COULTON: Some people say, well, you know, it doesn't do you any good if everybody in the world is listening to your music but they've all gotten it for free. And then I would say, I beg to differ. That's actually a fantastic situation. When you are not already a famous person, your real enemy is obscurity.

SYDELL: It certainly turned out that way for Coulton. Fans are voluntarily paying for his music. He's not rich, but he quit his day job. He says last year he made more money from his music than he ever did as a programmer. And Coulton feels he has more creative freedom than he would have if he'd signed with a record label.

Mr. COULTON: When you're a nobody like me, and you have this small, loyal, niche fan base, you can do essentially whatever you want. You can really be true to whatever quirky spirit moves you.

SYDELL: But music attorney Don Passman doesn't think this is a model that will work for all musicians — some aren't as entrepreneurial. Part of the problem, says Passman is that the technology hasn't reached a point where it can give people a complete online connection to their music.

Mr. PASSMAN: And I could access it in my car, on my home stereo, on my computer, on my connected device — whether that's an iPod or a cell phone or some other kind of device, or even on an airplane. If I can get my music anytime I want, organize the way I want it, I don't mind paying for that.

SYDELL: But until they come up with something that consumers are willing to pay for, Passman says, he can't figure out how the music industry is going to survive.

Laura Sydell, NPR News.

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