If you are thinking of giving up buying pre-recorded CDs in favour of downloading tracks from Napster, you could be in for a shock. While a CD collection sitting neatly on a shelf counts as contents on your home insurance policy, the equivalent collection stored in the memory of your computer, does not. Insurance companies treat stored music as a consequential loss, like a film lost with a camera. Neither music nor film is covered.

Backing up digital music files that have cost you money is a must. Napster, like all music download sites, lets you back up purchased music on additional computers (assuming you own one) but tests by ConsumerReports.org suggest the process is not always straightforward. In trials, licensing rights sometimes failed to download with music tracks, preventing back ups. ConsumerReports had to re-download files to fix the problem. Websites could help by offering free downloads in the event of loss, but few do. Napster's terms state that ‘if you have Purchased Tracks, it is your responsibility not to lose, destroy or damage them. Napster shall have no liability to you in the event of any such loss, destruction, or damage.'

Computer crashes aside, how does Napster compete against other download sites or buying pre-recorded CDs? We downloaded Napster's software without a hitch. You have to enter credit card details even if you just want to browse and not buy anything, which is like Amazon insisting on credit card details before allowing you access. Once past the promotional home page, the interface is not unlike its old namesake and is easy to use. Napster is owned by Roxio and uses Roxio's Easy CD Creator for managing, copying, burning and transferring music. Although it boasts 700,000 tracks, new Napster has nothing like the breadth of music of illegal sites. Its forum has lots of posts from members complaining about missing tracks but Napster seems good at responding with uploads. Our purchased tracks took several minutes to download on a broadband connection but seconds to burn to CD and transfer to portable player.

Napster's decision to offer different service packages, rather than iTunes's straightforward tracks for sale, seems a plus. Its subscription service costs £9.95 a month. You can download unlimited tracks to your computer and listen to them offline but they become unplayable once you stop subscribing. Reading messages on Napster's forum, the subscription service works well if your computer doubles as a music system. Others are using it as a much better sampler than 30 second clips, especially for expensive new album releases with decisions about buying albums as prerecorded CDs put off until later.

For non-subscribers, Napster charges £1.10 per track to purchase; subscribers pay 99p. All purchased tracks are encoded with Digital Rights Management (DRM) because record companies want to retain control over what you do with what you have just paid for. Unfortunately, DRM is having a nasty side effect on the compatibility of music files with portable players. Napster uses Windows Media Audio (WMA) format, which should be an advantage: most new portable players are compatible with WMA. But discussions on the forum suggest some supposedly WMA compatible players are not playing Napster's DRM encoded WMA files. ‘Tracks play on CD but not my Creative MuVo which is all I have', howled one subscriber. The consensus seems to be that generations of portable MP3 players are falling well behind the technology curve because they do not easily upgrade to accommodate the latest encoding.

Price when reviewed:
Subscription £9.95 per month Tracks 99p for subscribers; £1.09 non subscribers

Napster has been brave enough to include a forum on its site. Is this a hangover from Napster's early days when it was one of the most powerful, grassroots communities on the web? The biggest discussion topic is customer service and there are lots of messages from users having problems. But at least the site has a mechanism for responding to its customers. Napster's pricing on track downloads makes it uncompetitive, especially for buying new release artists' albums which last year were the driving force behind record sales. Record shops in the UK sold 234 million single album CDs last year at an average sale price of £9.63. Expect Napster's download prices to fall.