[Colleen Mcedwards, Cnn Anchor:] We are just hours before a key court ruling that could determine the fate of that highly popular Internet music swapping site called Napster. It's a federal appeals court decision. And it's expected to announce it today. And it will pertain to whether or not Napster violates copyright laws. CNN's James Hattori has more now on what is at stake.
[James Hattori, Cnn Correspondent:] Perhaps befitting the Napster case, the three-judge court of appeals will post its decision on the Internet early Monday.
[Dan Goodin, "industry Standard" Reporter:] I think the entire technology world is watching this case and waiting to see what happens.
[Hattori:] The issue is, should the Napster music file swapping service be shut down because it violates copyrights of music companies like Universal, Sony, Warner and EMI? Napster users copy songs over the Internet without paying royalties. Last July, a federal court granted an injunction stopping Napster, but the order was stayed on appeal until now. The appellate court could affirm the injunction, putting Napster back in jeopardy. It could overrule the lower court allowing Napster to remain in business. In either case, the copyright trial would go forward. Or the panel could send the case back to the lower court for clarification. Despite the legal uncertainties, Napster has continued its astonishing growth, doubling in size to more than 50 million users in less than 2 years. One of the original plaintiffs, BMG Music, whose artists include pop signer Christina Aguilera, cut a deal, agreeing to invest in Napster if it starts a fee-based service that pays royalties. The other big music companies in the lawsuit have so far rejected Napster's settlement proposals.
[Goodin:] These companies would much prefer to own the distribution and catalog service rather then to have to have Napster, a brand new sort of new media company, own it.
[Hattori:] But all bets are off once the 9th Circuit Court issues its decision. Rather than face continuing litigation, a costly trial, there may be added incentive to reach a settlement to capitalize on Napster's huge popularity and user base. James Hattori, CNN, San Francisco.
[Mcedwards:] All right, so if Napster gets nixed, where are you going to go? CNN's interactive correspondent Allison Tom is here to show us some of the sites where you might be able to...
[Allison Tom, Cnn Correspondent:] That's right. A lot of them are already out there. So if people are concerned about Napster going away, some people are already using many sites. So we're going to walk you through a couple of them.
[Mcedwards:] Sure.
[Tom:] The first one is Newtella. Now, this is a peer-to-peer type of base sharing information. So what you'll find here is that you download an application onto your computer, and then you'll be able to share information, but not just music. You'll also be able to share pictures, photos, audio, video files, a whole bunch of different kinds of applications in addition to just file-swapping with songs. So you'll see that there's a lot of people who will use this just to do that. And it's with everybody: anyone's who connected.
[Mcedwards:] And it's free too? I mean...
[Tom:] This is free.
[Mcedwards:] Does it work the same way?
[Tom:] That's correct. Some of them, of course, are not. They might have some sort of fee-based charge that they might use. But, in general, most of them are free. Now, another we're going to take you to is Aimster.com. This one is a sharing tool that really enables you, again, to use songs, pictures, video, a whole bunch of different kinds of applications. And what's different about this one is they have a buddy list. So a lot of people who are on it might know who they're exchanging information with. So rather than just being a stranger somewhere around the world, it'll be actually you or I or somebody else than you know. So it's a way to kind of protect some of the information that you're exchanging.
[Mcedwards:] Got you. And I'm going to profess my ignorance here a little bit. I mean, do these other sites work in the same way that Napster works?
[Tom:] Very, very, very similar. They're not quite as friendly. They're not quite as user friendly as Napster. Napster has become so popular because of its ease of use and because it's so easy to do to: to download and everything. But most of these will walk you through. So it's not entirely difficult. But you will have to just get into it a little bit more. And this is the last one we're going to show you: iMesh.com. What's different about this one, as well, is that when you download this and again, this is a free one similar to the others that we showed you it's very easy to install. And what'll happen is that if you're downloading a song, for instance, it will still continue to download this even if that person on the other end logs off. So, it'll try to find that song from somebody else or it'll continue with the original person that you were downloading the song from.
[Mcedwards:] Is there a way to tell, in advance of this court decision that's coming down, I mean, what how what the extent of usage has been on Napster and these sites? Are people are people rushing to try to get this?
[Tom:] Absolutely. And especially because of the concerns that Napster might be shut down today, a lot of people this past weekend have been downloading quite frequently. So a lot of people have been going on. People have been doing this all throughout the court hearings, because they're concerned of that and not being able to get it. But with these kinds of Web sites, you see that no matter what, there are still a lot of different ways that people can exchange information.
[Mcedwards:] But, if there's if there's a court ruling that is against Napster, what might be the implication for some of these other sites?
[Tom:] That has yet to be decided.
[Mcedwards:] That's the question, isn't it?
[Tom:] We really don't know. Exactly, that's the big question, because a lot of these sites have been watching very closely as to what happens: whether it's going to be that they can continue exchanging information like music or not. So...
[Mcedwards:] What if what if somebody feels I don't know, maybe feel a little bit moral about it and wants to pay? I mean, is there a place they can go where they actually pay for the music they download?
[Tom:] Sure. And some like MP3.com, for instance, some of them: They are copyrighted, you know, songs that you can download. And some of them you do pay for. So it really depends on certain Web sites. Now, a lot of places if you go to like CDNOW, a lot of these music Web sites, you do have to pay for certain ones. And, of course, you can't actually burn them onto your own
[Cd. Mcedwards:] Right. Right.
[Tom:] So there are still certain things like that. And if Napster does get shut down, maybe they'll change more into what we're expecting, into a fee-based type of system.
[Mcedwards:] OK, Allison interactive correspondent Allison Tom bringing us up to date on that. And that ruling, it's from the 9th Circuit Court of Appeals. It's expected at about 1:00 Easter Time Eastern time, rather. You can read the decision online if you like at the court's Web site. It is www.ca9.uscourts.gov.