Napster fate hangs in the balance

The immediate fate of Napster will be revealed this evening when a US court will decide whether the online music file-sharing community should be shut down.

The announcement by the ninth US Circuit Court of Appeals in San Francisco on Friday sparked a flurry of activity on Napster's website at the weekend, as music fans flocked to stock up on free songs.

Nearly 10,000 users logged on to each of Napster's 100 servers on Sunday, sharing nearly two million free MP3 song files, compared to a sample taken last July which found 7,300 users sharing 800,000 files.

Last October Napster escaped closure after three judges from the same appeals court decided not to reinstate an earlier injunction that prevented the company from offering its service. The injunction was to have barred users from swapping copyrighted material belonging to the five major recording companies that are suing Napster for alleged copyright infringement.

Instead, the appeals court said it would take time to decide what to do with the music file-swapping company that counts more than 38 million members worldwide.

The outcome of that decision, which will be announced this evening at 7pm GMT, could either mean the original injunction is upheld, or that Napster would be free to continue offering its service until its wider-ranging court battle with the recording industry is heard at a later date.

On its website, Napster said it has great confidence in its legal position and will post a statement about the decision shortly after the court issues its ruling.

But according to Hilary Rosen, president and chief executive of the Recording Industry Association of America (RIAA), the trade group representing record labels against Napster, the court's decision may "finally clear the way for the legitimate online marketplace to thrive in an environment that encourages both creativity and a respect for copyright".

Rosen said in a statement: "We're confident that the Ninth Circuit understands the severity of our claim and will uphold the decision of the US. Federal Court."

Since the judges' initial decision last October, Napster has signed an agreement with German entertainment giant Bertelsmann to begin charging users for the service.

Bertelsmann, which owns BMG, one of the recording labels suing Napster, agreed to drop its lawsuit once Napster introduces a subscription-based model sometime in the summer.