Napster will begin charging users for access to its music sharing service from the summer.
The move was announced by chief executive Hank Berry at the World Economic Forum in Davos, Switzerland.
He told the BBC that Napster would provide the same level of service on a subscription basis but did not say how much it would cost.
Napster's move to a less controversial future was signalled in November, when it signed a deal with record label Bertelsmann's BMG.
Bertelsmann had participated in industry-wide legal action against Napster alleging copyright infringement, but dropped its action to co-develop a system that would guarantee royalties to artists.