wax&wires

First Sale Doctrine and Used MP3 Sales

I found this article on ArsTechnica and it’s a good follow up to my post on bopaboo, the used mp3 store.

It unveils a few more details that I didn’t know about in my initial post, including the application of the first sale doctrine in a digital media world. The first sale doctrine was initially drafted in 1908 and essentially said that the purchaser of a good is entitled to sell it without permission of the original owner, publisher, or copyright holder as long as no additional copies are made.

Here’s where there’s growing difficulty with the used mp3 market. We can’t be sure if the first sale doctrine actually applies, since there’s no way of knowing whether or not an additional copy was made. Sites like Bopaboo can ensure that additional copies of songs aren’t sold on their site by the same user, but cannot ensure that additional copies are not retained by the user or sold elsewhere.

In the article, Rich Bengloff, the president of the American Association of Independent Music, talks about how the industry is reluctant to embrace used sales because there’s no monetary return to the original creators or publishers. Nate Anderson, the author of the article, asks Bengloff what the difference is between selling a used song on bopaboo and a used dinner table on craigslist. After all, the original carpenter of your dinner table doesn’t see additional returns when you sell it. Bengloff states that the carpenter might see returns in the form of needing to repair the table or re-stain it, where as the digital copies of music don’t whether so there’s no market for additional return. I totally disagree. I’m not a fan of the used mp3 market, but I think that he’s making a severely flawed argument. If you’re going to chalk it up as a worthwhile return that a carpenter might get hired to refinish a table he made years ago, you would have to argue that artists have a worthwhile return from used mp3s in the form of an extended fan base and concert ticket sales. I would bet that more people would go to a concert of a band after downloading their used mp3, than would hire the same carpenter who built their table to refinish it. Who even has their tables refinished? I can think of one person I know who has refinished a table, and he did it himself rather than hiring a carpenter to do it (much less tracking down the original carpenter to come in). On the flip side, I couldn’t even count the number of people I know who have gone to shows and concerts, or bought merchandise after downloading a band’s music online.

I’ll let you read the article for yourself to develop your own view on it.

Bopaboo is now seeking licensing from the music labels, which would actually give the labels a bit of return for used mp3s sold on bopaboo in exchange for not taking legal action against the website. There’s a slim chance that with the support of the labels bopaboo could succeed, but I don’t see it happening so long as the free p2p music market is still so at large.

But enough with my commentary, check out the original article here.

This entry was posted on Thursday, December 18th, 2008 at 7:41 pm. It is filed under wax and tagged with amazonmp3, itunes, law. You can follow any responses to this entry through the RSS 2.0 feed.