Napster survives latest court battle

Napster has survived its latest court battle after three US judges decided not to reinstate an injunction against the file sharing system that would have effectively closed it down.

Instead, the judges decided that they would take time to consider what to do about the controversial service that has riled the Recording Industry Association of America (RIAA), which represents the leading record labels.

There was no indication as to when the judges would announce a decision, and in the meantime Napster can operate as normal.

The judges heard from both sides at the hearing. David Boies, Napster's lead attorney, who represented the US Department of Justice in the Microsoft antitrust case, argued that Napster should not be shut down because the number of legal ways to use the technology was multiplying.

For the RIAA, Russell Frackman told the court that Napster had been designed to facilitate piracy from day one. He said that millions of people were infringing the copyrights of record companies and artists every day.

And those millions are growing. Napster now claims 32 million registered users, up two million in just the last seven days.

Separately, a study carried out on behalf of the US National Association of Recording Merchandisers said that the future threat to retailers comes not from downloads of digital music, but from streaming audio.

Online and bricks and mortar retailers will benefit in the short term. Once streaming audio technology advances, it will allow for highly targeted content, almost to the point of listening on demand, the study said.