Napster has record companies stirred, but not shakin' all over

The music industry has reacted fearfully to the emergence of companies like Napster, which publishes software that permits users to freely share libraries of MP3-formatted music files, and some industry observers have fueled anxieties by predicting the end of traditional music retailing. In spite of threats perceived by groups such as the Recording Industry Assn of America, however, record companies have not reported any declines in their profits. In May 2000, the music group Metallica filed a lawsuit against Napster, claiming copyright violations, but this could be interpreted as a counterproductive overreaction. In fact, MP3 files are not anywhere near CD quality and may represent less of a threat than had been thought.