An attempt to sell the company to German media company Bertelsmann failed, apparently due to a dispute between two directors of Napster. According to an e-mail sent to the company, a copy of which was seen by CNet News, Hilbers wrote: “Unfortunately, the board has chosen to not pursue the deal... I am convinced that not pursuing the offer is a misake, and it will lead the company to a place where I don’t want to lead it.”
As a teenager, Shawn Fanning wrote the Napster software which brought peer-to-peer computing to the world’s attention. Until yesterday, he worked as the company’s Chief Technical Officer. Fanning was among others, including the company’s general counsel, who, according to reports, resigned with Hilbers.
The Wall Street Journal reports unnamed sources who say that the company is preparing to file for Chapter 11 bankruptcy protection.
At its peak, Napster claimed to have around 60 million registered users. Its service was shut down in July 2001. The current champion of P2P file sharing is KaZaA. The site claims that its P2P software has been downloaded more than 78 million times.