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In June of 1999, Shawn Fanning and Sean Parker released a piece of software called Napster. Napster allowed those who had purchased a commercial CD and ripped it to the MP3 format to distribute their MP3s directly and efficiently to a worldwide audience via a P2P network, thereby depriving artists, rightsholders and distributors of potential revenue from additional sales.

Unsurprisingly, the record companies and their trade organization, the RIAA, were appalled at their products being shared user-to-user for free rather than purchased directly. In their eyes, their formerly paying customers were all thieves, not would be buyers who merely wanted a simpler, more convenient way to purchase music digitally. As a result, their response to this disruptive threat was not to offer users what they wanted: an online purchasing offering. Instead, they attempted to further restrict the digitization of physical media such as CDs, they employed advertising scare tactics and eventually litigation of their would be customers. They saw licensing and enforcement as the solution to a business model problem, in other words.