The file-sharing application offers to "provide $1 billion" to record labels over the next five years...

NAPSTER has offered to “provide $1 billion” to record labels over the next five years in an attempt to reach an agreement in the ongoing copyright dispute with the RECORDING INDUSTRY ASSOCIATION OF AMERICA (RIAA).

In a statement released yesterday on [url=], the controversial file-sharing system reveals details of how Napster could become a subscription service as early as the summer.

Under the new proposals, Napster users will subscribe to a ‘Basic Membership’ or a ‘Premium Membership’ plan, expected to cost between $2.95 and $9.95 per month. Members who subscribe to the ‘Basic Membership’ would be limited in the amount of songs they could transfer, while the ‘Premium Membership’ would offer “unlimited file transfers”.

From the subscription funds, Napster promise to “provide $1 billion to the major labels, songwriters and independent labels and artists over five years”, which amounts to $150 million per year.

The amount each label receives would depend on the number of files transferred. It is anticipated that $50 million per year will be set aside “for independent labels and artists”.

The statement continued: “Now that the industry has the legal precedent they were seeking, it is time to reach an agreement. The RIAA has been saying the consumer comes first, the consumer comes second, and the consumer comes third. If the industry has the consumer, and their own bottom line in mind, there is an agreement to be had here.”

However, in a separate statement issued yesterday (February 19), Hilary Rosen, CEO of the RIAA, urged Napster to “redouble (its) efforts to build a legitimate system”.

She commented: “We understand Napster’s desire to not have to cease its operations in order to comply with an injunction order from the court that would be limited to protecting only copyrighted works.

“To the management of Napster I say again: You claim you want to be legitimate, and negotiate licenses based on real business models. I urge you to act accordingly. Stop the infringements, stop the delay tactics in court, and redouble your efforts to build a legitimate system. Our member company plaintiffs have always said that they stand ready and willing to meet individually with you to discuss future licenses. This path would be more productive than trying to engage in business negotiations through the media.”

As previously reported on NME.COM, Napster’s future hangs in the balance after a US court ruled earlier in the month its service infringed copyright by allowing users to download MP3 files of songs for free.