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This is how the music industry lost its golden chance to control the digital music market.

Napster was an online music file sharing service. The technology allowed people to easily share their MP3 files among each other, bypassing the established market for such songs. Shawn Fanning's creation soon became a rage among most music lovers. With people making their own compilation albums on recordable CDs with songs downloaded from Napsters.

However, the record companies sued Napster for copyright infringement. The then-Napster CEO Hank Barry called for the music industry to adopt a radio-style licensing agreement that paid royalties to artists for music distributed via Internet. However, the music industry didn't agree.

Napster fans moved on to other peer-to-peer file-sharing networks such as Gnutella and Grokster. In 2000 MP3.com, launched a service that allowed users to upload songs from their own private CD collection and stream them to any PC. However, it was also sued for copyright infringement.

Result is today music-subscription businesses and streaming services dominate digital music. Had the record companies listened to Napster CEO and found a middle path rather than suing these file sharing networks, they might actually be controlling the digital music landscape.