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Abstract
Napster is a software application that enables peer-to-peer file sharing. Napster was established by Shawn Fanning, an undergraduate at Northeastern University. He integrated features of established programmes to enable computer users to share MP3 formatted music files with other computer users. This innovation became hugely successful with up to 60 million users downloading music files from other computers. For the music industry, this digital distribution system was seen as an immense threat. If music fans could download music at no cost, why would they carry on buying music in CD format from bricks-and-mortar or web-based retailers? The case traces the history of Napster from its start-up in 1999, to its legal termination in 2002. The case study focuses on several interrelated issues: innovation, disintermediation, channel relationships, customer experience, PEST analysis, and copyright. It can be used on marketing, entrepreneurship, supply chain and strategy courses.
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Abstract
Napster is a software application that enables peer-to-peer file sharing. Napster was established by Shawn Fanning, an undergraduate at Northeastern University. He integrated features of established programmes to enable computer users to share MP3 formatted music files with other computer users. This innovation became hugely successful with up to 60 million users downloading music files from other computers. For the music industry, this digital distribution system was seen as an immense threat. If music fans could download music at no cost, why would they carry on buying music in CD format from bricks-and-mortar or web-based retailers? The case traces the history of Napster from its start-up in 1999, to its legal termination in 2002. The case study focuses on several interrelated issues: innovation, disintermediation, channel relationships, customer experience, PEST analysis, and copyright. It can be used on marketing, entrepreneurship, supply chain and strategy courses.