Owned -vs- Rented Media and the “Right to Resell”

Bill Rosenblatt of GiantSteps Media published a thought-provoking article The right to resell: a ticking time bomb over digital goods. It’s worth a read. Below I’ve shared some of my comments on his article.

When it comes to media in our culture today, we have two crisp models of acquisition, as defined by contracts, legislation, and case law: ownership and rental. Ownership falls almost exclusively into the “physical media” bucket and “digital media” is generally a rental (licensed) model. I for one hope we can someday work out a third model for “digital ownership” that works for consumers and for creators and for rights-holders.

If we as a society can create this third model of “digital ownership” sooner rather than later, we can leave “rented media” behind, in what will be a comparatively small bucket of “non-transferrable assets.” For example, over the last 30 years, US consumers have invested, in 2012 dollars, on the order of a quarter-trillion dollars in physical CDs, each with crisp fair-use and first-sale rights. The comparative total investment in rented digital music in the last 8 years is on the order of 5% of that.

We should be thoughtful about railing against rights-holders for the legal rights (or lack thereof) of the digital music that consumers have (bought) rented. In theory, we consumers knew exactly what we were getting into. That is to say, the terms of the licenses we agreed to are not unclear. Of course one can argue whether the average 18 year-old can and will read and understand all that legalese.

The ReDigi solution strives to expand the scopes of both legislative dicta and case-law. As Mr. Rosenblatt suggests, they’ve chosen a challenging mountain to climb. I’m not so sure I agree with his aside that it’s an odd position for ReDigi to take to enable first-sale-like rights AND bring the rights-holders in to participate as well. While this is indeed a deviation from what legislatures and judges have enabled, let’s be open-minded about asking questions like “why not?” as we attempt to sort out these thorny problems.

The fundamental challenge here (IMHO) is that most consumers of downloaded content make certain assumptions that they have fair-use and first-sale rights. They do not generally have those rights.

Each and every day Murfie wrestles with these issues of ownership -vs- rental as we attempt to integrate all of our customers’ music purchases across any and every physical and digital format.

Published by

Shawn Broderick

Troublemaker

One thought on “Owned -vs- Rented Media and the “Right to Resell””

  1. Hi Shawn,

    There is actually a putative technical standard for “consumer ownable digital property” that space constraints (believe it or not) prevented me from mentioning in my PaidContent article. The standard, IEEE P1817, was developed a couple of years ago, and its inventor, Paul Sweazey, spoke about it at one of my conferences, but it seems to have run out of steam. You can see the standard itself at http://standards.ieee.org/announcements/2010/1817.html and my analysis of it at http://copyrightandtechnology.com/2010/07/02/1054/.

    BTW I just checked out your service. Very interesting. Two comments: first, if you guys are looking to expand into pure digital files instead of CDs, then (or even if not), you and I should chat, as I’ve spent a lot of time looking at the legal boundaries here. Second, if you expand your service to vinyl LPs, I’d sign up in a heartbeat.

    I’m at billr@giantstepsmts.com if you would like to continue the conversation.

    Best,

    – bill.

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