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Resale revolution for digital books and music

David Streitfeld (via AFR) | March 11, 2013
The paperback of “Fifty Shades of Grey” is exactly like the digital version except for this: If you hate the paperback, you can give it away or resell it. If you hate the e-book, you’re stuck with it.

Resale revolution for digital books and music

At least you can sell the physical copy of Fifty Shades of Grey you bought, you’re stuck with the digital version ... unless you liked it of course. Photo: Louise Kennerley

The paperback of "Fifty Shades of Grey" is exactly like the digital version except for this: If you hate the paperback, you can give it away or resell it. If you hate the e-book, you're stuck with it.

The retailer's button might say "buy now," but you are in effect only renting an e-book; or an iTunes song; and your rights are severely limited. That has been the bedrock distinction between physical and electronic works since digital goods became widely available a decade ago.

That distinction is now under attack, both in the courts and the marketplace, and it could shake up the already beleaguered book and music industries. Amazon and Apple, the two biggest forces in electronic goods, are once again at the centre of the turmoil.

In late January, Amazon received a patent to set up an exchange for all sorts of digital material. The retailer would presumably earn a commission on each transaction, and consumers would surely see lower prices.

But a shudder went through publishers and media companies. Those who produce content might see their work devalued, just as they did when Amazon began selling secondhand books 13 years ago. The price on the Internet for many used books these days is a penny.

On Thursday, the US Patent and Trademark Office published Apple's application for its own patent for a digital marketplace. Apple's application outlines a system for allowing users to sell or give e-books, music, movies and software to each other by transferring files rather than reproducing them. Such a system would permit only one user to have a copy at any one time.

Meanwhile, a New York court is poised to rule on whether a startup that created a way for people to buy and sell iTunes songs is breaking copyright law. A victory for the company would mean that consumers would not need either Apple's or Amazon's exchange to resell their digital items. Electronic bazaars would spring up instantly.

"The technology to allow the resale of digital goods is now in place, and it will cause a dramatic upheaval," said Bill Rosenblatt, president of GiantSteps, a technology consulting firm. "In the short term, it's great for consumers. Over the long term, however, it could seriously reduce creators' incentive to create."

 

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