Napster
At one time people purchased music on CDs, tape, or vinyl discs. Although people still buy music this way, many now stream or download music via an online service. That trend was started in 1999 by Napster, a peer-to-peer file transfer service that was started by Shawn Fanning and Sean Parker.
By February 2001, the same month that Apple introduced iTunes, Napster had 80 million users. However, the big issue with Naster was that the recording artists were not being compensated. Lawsuits brought by various bands, most notably Dr. Dre and Metallica, forced Napster to cease operations later that year.
There’s actually some evidence to support that Napster downloads increased CD sales. For example, the band Radiohead, that had never made it into Billboard’s Top 20, had one of their CD downloaded millions of times before it’s release. When it was released, it immediately became Billboard’s number 1 album. Other bands had success with their recordings that they attributed to Napster as well.
In any case, in 2001 Napster settled many of the lawsuits and attempted to convert from a free service to subscription service, so that they could pay all copyright holders for the music being downloaded. Their plan was to restart Napster with this new business model, but in 2002 they were forced to liquidate under Chapter 11 bankruptcy.
The name and trademark were eventually acquired by Roxio and then in 2008 by Best Buy, who in 2011 merged Napster with the online music service Rhapsody.