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Apple Responds To iTunes "First Sale" Question
atallah writes "It looks like Apple has come out and explained its position on resale of songs. It is interesting that they didn't flat-out reject the idea.
Check out this Business Week article."
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Legal considerations are beside the point; it is very near impossible at this time to sell an iTunes song without also selling your Mac...and your credit card. There's always ripping from a CD burn, but at that point it isn't an iTunes song, it's a below-quality CD rip.
that's because apple wanted to see what they could *really* charge for online music
Apple comes out looking like they (a) understand copyright restrictions and took that into account already, and (b) still don't want to be the RIAA and crack down on this sort of thing. This is called "design". They made it difficult enough to sell iTunes songs that they don't need to worry about reselling, even if it is legal. That said, someone's going to find a way around it eventually, if current trends hold.
This is my sig. There are many others like it, but this one is mine.
They keep saying it's impractical to sell the songs...well, how about trading songs with other iTunes users? I'm sure there is some right somewhere where you can give stuff away that you bought a copy of. (Basically sell it for $0). So...the real question is...why can't i just forward my legally purchased songs to Jim Bob the same way i could hand him my physical CD.
In stores which buy my used cds, they offer me a fraction of the price for the cd. If I payed $12, then they offer me $4. Why cant I do the same with the music I buy from Apple? Sell 10 tunes for $5? Especially if they sucked.
Notice how cleverly Apple sneaks in how it will not assist in transferring the song's ownership.
Thus, it neatly avoids entangling itself in the 'first sale' right issue by making it entirely an issue of 'practicality'; without offering a mechanism to transfer the Apple ID, Apple locks you into ownership.
-Alex
Economically, I don't believe there is going to be much of a market for resold music...We just don't see it as that much of an issue
Wrong! Many many people will buy mp3s if its only 10 cents an mp3 and they would not mind a "used copy". Someone reselling can put the price so low if he has rights to the song after he is done listening to it.
New year Resolution: Don't change sig this year
Apple says it's impractical because a song is $.99. However, what happens in a few years when someone has 100 songs that they no longer listen too. Wouldn't it be practical to sell that lot of 100 songs for $50?
So basically Apple has said that it may or may not be legal to resell a song, but it would be technically difficult to do so, and it only cost 99 cents in the first place so why would you want to? Thanks for not answering the question! Maybe I do want to resell a song. Maybe I want to sell my entire iTunes music collection. Maybe I'm clever enough to overcome the technical difficulties. Would it be legal or wouldn't it? And if Apple established that it was, wouldn't I feel better about buying from the iTunes music store?
Deny everything. Apple has put their fingers in their ears and are sitting in the corner singing "la la la I can't hear you". Technically they are probably right, this is not very practical - but the legal validity of such a sale still needs clarifying as it has ramifications for other applications of copyright law to digital (by which the lawyers seem to mean "downloaded"[0]) content.
[0] They don't (yet) seem to claim this legal dilemma would apply if the music was on a CD, only if it's downloaded... This, to me, seems nuts - why does the medium in which you obtained the content make a difference?
"'I pass the test,' she said. 'I will diminish, and go into the West, and remain Galadriel.'"
- JRR Tolkien.
First of all the whole idea of selling songs on the digital media is bad atleast until all the DMCA act and all others like it get really tested and amended to remove some that silliness that they have incorporated. Second like any other online sale digital music should also be allowed to be sold just like any other piece of junk music we buy. Until them paying a $ for each crappy song is still too much. besides the artists get few cents. Scew RIAA and the DMCA . Boycott CDS for a while which would force them to come with a better business model.
Technical issues could be overcome with an addition to the Apple Music Store authorization system that let you give your song to someone else, deauthorizing you in the process. No major technical difficulties there. The real problem comes in verification that you have not made copies for yourself. If you have, then the "re-sale" is simply a fraud. The only way they could do this is have every computer that is authorized on the account report back whenever the song is burnt to a musics CD - it would be worthless as a data file (unless you manually drop it on your iPod...), only allowing you to sell songs you have never duplicated. However, I don't think Apple wants to keep track of everyone's CD burning, and people are just as unlikely to be interested in the prospect.
Of couse, you could get around this by using a program that grabs the audio stream during playback and acheive the same end result.
I understand Apple's position. Even if it isn't the greatest solution, they have stated that they believe in the "first sale" right, even though it isn't practical to implement. Their stance can be noted when the time comes that support for those rights is needed.
That what was all this school was for... to teach us how to solve our own problems. -- janeowit
They seem to be handling this pretty responsibly. Most companies (and people as well) will go on the attack when this sort of thing happens. The MMORPG companies have been particularly mean about this sort of stuff when they probably could have done things in a much more responsible way. I'm really not a fan of Apple, but it's nice to see that somebody keeps doing things right when everyone else seems to be sueing, legislating, lying, bribing, bombing, terrorizing, and so on.
-dbc
Since no music can ever become out of print or rare at iTunes, that removes another incentive to buy "used" songs. People would have to sell them for less than 0.99 to make others interested and to compensate them the complexity of buying the song on eBay instead of the convenience of iTunes. That would make sense with large collections and, I believe that once this will really become important for iTunes customers, Apple will do something. After all, lack of a resell market for digital songs would somewhat limit their value and make people hesitant to spend money on them.
But in any case, iTunes is a doomed venture. Unrestricted MP3s/OGGs are the way to go. Eventually it will become obvious, although Apple might get a fair profit alongway.
Future Wiki -- If you don't think about the future, you cannot have one.
Serious collectors frequent estate sales. They're good places to find collections which are of no interest to the survivors of the deceased. Books and music are often overlooked.
The Apple spokesman dismissed the resale potential of a 99 cent download. He overlooked the value of a 1000 song collection, where transfering the license keys would be well worth the effort.
It's hard and impractical to resell individual songs that we never envisioned needing the extra clause in the TOS. Please mull over how to transfer your songs while we add the clause.
Thank you,
Apple
They would create an ebay like system directly in iTunes that would allow me to sell my music to other people. Both music I created and music I've purchased from itms. They provide the audience, I provide the bandwidth and content, Apple would get a cut which would go towards paying the artists and record label if one were involved. The rest goes to me, and lets say for each sale of an individual song the overhead of label costs would decrease for each time the song is sold. Obviously the centralized listing of sellers would have to be seperate from itms, but I think it could work. Think napster with a twist.
--Rick "If it isn't broken, take it apart and find out why."
(40gigs / 5mb a song * $.99 a song) + $500.00 ipod = ~$8,500.00
One problem with geeks is they read, but don't understand.
What Apple is saying is "we don't want to get into that."
The reason Apple is saying that should be obvious to anyone who bothers to think about it. For those of you that don't, the reason is this:
They want to sell you music.
In the legal system, there are fictions that are there so things can get done.
In technical terms, there are hacks in place that everyone knows are skanky, but nobody wants to look to closely at them because they make stuff work. The technical equivalents are things like DNS, SMTP, etc. They suck, but what can you do?
In the same vein, Apple wants to keep selling music. It does this by playing both sides of the fence - negotiating licenses with publishers, and allowing loose licensing by the users.
As long as nobody looks too closely, well, everything's OK.
Users can do whatever the hell they want, but Apple has to play a game, and play it well.
"Economically, I don't believe there is going to be much of a market for resold music...We just don't see it as that much of an issue," he said.
Gee, tell that to the used CD stores I've bought dozens and dozens of CDs from over the years.
"People" using "unnecessary" quotes should be "shot".
What if I purchase a song and decide that I don't want it anymore. Can I give it away?
Sound waves should be free!
Why does the transfer of the electonic version of the song need to be free? Considering the (realtively) small amount of time it would be used (less than 0.0001% of sales) , I can easily see the cost of the transfer being $2-5 per song. Transfer accepted, but not cost effective.
The dogcow says "Moof!"
Let's see, you pay 99 cents for the song and now you're going to resell it. Unless it's no longer available why would I pay you more than 99 cents for the song or pay you at all when I can just as easily get it from a trusted source: Apple.
And why would you charge less than 99 cents for it? It's a dollar. Most people aren't so scroogish about their money that they will try to get a dollar back. And most on-line money transfer places don't make it economical to sell something for a buck. The fees are too high. With PayPal you'd only end up with 66 cents on that dollar. And it's quite a hassle to mail you a dollar in which case I'm paying an additional 37 cents at least.
Apple got it right. The technical restrictions and the low cost make it a waste of effort to try to resell to regain the cost of the product, much less make a profit. They quite literally made it impossible to be undersold.
If songs ever stop being offered by Apple then one may have a business opportunity. But that would require buying numerous licenses of each song to make it worth it and require some foresight into what's going "out of print" that people will still want years from now in order to avoid wasting money on songs you'll never be able to sell once the market swings your way to check out what you have.
Instead of fighting Apple in this worthless pursuit of pennies, you'd be better off forming an allience with indie bands and set up a business being the first time sellers of their music. There's a huge market for that.
Ben
Work Safe Porn
Please show the court the object you purchased.
The doctrine of first sale doesn't apply just to copyright.. it applies to everything. You can only sell something once.. then it's not yours anymore.. the same goes for a book.
Apple isn't weaseling out of anything.. they are merely showing that something is not their problem to solve.. they were up front about what you were paying them for. The rest is up to you.
It's very refreshing to see a company actually talking about the issue, instead of suing over it.
Linux, you magnificent bastard, I read the fucking manual!
for $0.99 you get not only a product, an encoded AAC audio file with an album cover graphic and meta data describing the song, but you also are buying a service.
That service is the key. (pardon the pun)
Apple is providing the means to manage the unlocking of the file - presumably for as long as you own the AAC file. But Apple's service is limited. Their service does not include the management of your license. Their service does not include a utility to transfer ownership or will AACs to your heirs. One much booed but accepted limitation is that it doesn't include the ability to re-download the songs you purchased, so you have to archive them yourself.
There are lots of alternatives out there. Apple has bundeled the product and service they feel is most compelling to the marketplace. 10,000,000 songs have been purchased so some people are compelled. Yet there will always be the OGG zelot or the eBay seller who really needs to push the limits of the license. To both groups as it turns out, I recommend they but the CD, rip it to OGG, and when they are done, delete the OGGs and eBay the CD for half what you paid. You might even come out only paying $0.99 a song that way.
As for me, I'll stick with iTMS which gives me more than I could ask for, and all they ask is $0.99 (plus tax).
I only came here to do two things; kick some ass, and drink some beer...looks like we're almost out of beer.
I can sympathize with Apple's position here; the effort to setup some kind of (ideally) automatic system to transfer the digital rights and still prevent piracy isn't worth it to them. However, when you're talking about multiple files, it quickly becomes relevant to the owner who wants to sell.
Issues like this is why I still buy a CD whenever the impulse strikes. I just don't buy as many as I used to; I'm much choosier about who I'm supporting.
You see, as far I as I'm concerned, CD's are future-proof. I can rip them into whatever format I want to use. Right now I'm using AAC in iTunes, but that could change. I may want to sell the music, or let my partner listen to it on his office computer. Digital files are definitely the future -- who can doubt it -- but for right now, the CD (or other physical media) is the safest investment.
Assuming that resale of online music becomes legalized, practicalized, and widespread, this could mean the end, or at least reasonable limits to the mass-consumption pop crap that floods the music market.
With resale available at the press of a button, after the initial catchiness has worn off and the latest Britney song has become just as sickening as the rest, the User A can release his copy for a resale at the going market rate. This rate would depend on the original track price, number of copies for sale and the number of potential buyers.
User B, who hasn't become sick of the song yet, can pick up A's used copy instead of buying another new copy. This curbs the sale of a song to the number of unique users actually interested in the song at one time.
Instead of releasing lowest-common-denominator slop to try to appeal to all people at once, recording artists will be forced to make solid works aimed at specific listeners, who will want to hold onto it for a long time. Or at least it will even the field between those who do and the slop-shovellers at Sony.
It could even start a futures market -- people buying thousands of copies of a song at a cheap point, hoping that it will regain popularity at some future point. This could redefine the term "entertainment industry" as we know it.
Of course, this is all based on the above (false) assumption that companies have their consumer's interests at heart. Since they want to sell as many songs at as high of a price as possible, Apple will design iTunes to make sure that this never becomes possible.
I often download iTunes songs, burn them to CD, and then rip them. The quality sounds fine to me. I don't personally do it for resale or illegal copying; I'm a jazz musician, and when I want to practice and memorize a new song, I make versions of it that are electronically sped up and slowed down so that it's in 6 or 7 different keys, so that I can practice playing along with it in all those different keys. This of course falls under the personal use exception to copyright, not the doctine of first sale.
The cool thing is that when you have a digital technology that doesn't have a bunch of plastic padlocks built into it, different people can do different things with it, and they don't have to say "Mother may I."
It was interesting that the article claims there are legal decisions from the copyright office saying first sale doesn't apply to digital stuff -- that's the first I'd of heard that. Can't say I really care, though: Congress gave me the right of first sale, the personal use exception, and the fair use doctrine, so a bunch of unelected bureaucrats can take them away from me when they pry them from my cold, dead hands.
Find free books.
We accuse the RIAA, MPAA, and other big special interest groups of not adapting to the internet and clinging to outdated paradigms. Aren't you doing the exact same thing, applying a paradigm that easily applies to physical property but can't be applied (or is technically unfeasible) in the digitial realm?
has anyone read it?
Yep.
i wonder if this is "handled" by the contract you agree to.
The agreement doesn't specifically get into personal resale, but it does stress repeatedly that the product is for "personal, noncommercial use." That language is vague enough to leave the question open :/
The article has pretty much highlighted that Apple has a flat head. Nothing more, nothing less. I think it's pretty fair for them to say that "It may be legal (or illegal), but it's pretty darn impractical!" Sure it would be much nicer if there was an easy way to re-sell the music files, and I do believe that it's legal, provided you follow a few common-sense steps such as not retaining a copy after the sale.
A lot of slashdotters are probably gonna complain that Apple needs to create a method for transfering ownership, and all I can say is, no they don't. I have every right to sell my DVD collection to a friend in England. (I live in Japan.) He has every right to go out and buy a DVD player that can play them, or modify his own, since it's a different region DVD. Yeah, it's a pain in the ass and almost evil to have region coding, but that has nothing to do with the copyright of the DVD in question.
The only difference with the DVD and iTunes file is that with DVD's, the "impracticality" was put there on purpose, which in my mind means the organization(s) responsible for the region coding are a bunch of assholes. As for the iTunes file, the copy protection method was put there so that Apple could manage to
1) strike a deal with the labels,
3) deliver what the consumer wants (downloadable legal music), and
2) still manage to maximize consumer rights. (CD-R burning.)
(And yes, 4: profit!, but there's nothing inherently wrong with that.)
I'd say Apple did a damn good job at it, even if it's not perfect. Truth is, the reason it isn't perfect is more or less the record label/RIAA's fault and not Apple's. If you don't like it, don't buy it.
I'm speculating a lot here, but I get this feeling that if you made a CD from the iTunes file, and sold the iTunes file AND the CD together, Apple could care less. Apple is merely providing a SERVICE in exchange for a small percentage of the sales. It may be legal grey zone, but it isn't damaging Apple's sales (as long as you're honest and delete your own copy after sale). Hell, it probably isn't even damaging the RIAA member's that much either, and is within the owner's rights. (And if it's within the owner's right, then it isn't even "damage" any longer.) But for some reason they make a fuss over it.
So what we have here is a very odd scene, really. "Holy shit, a large corporation using common sense! It must be a conspiracy!!" And it just as well may be, except it's a conspiracy that is backfiring on the RIAA and in return making Apple look pretty slick.
C'mon guys/gals, it's just common sense.
Yeah! That's what surprised me too. I have never heard the "Right of First Sale" doctrine questioned before when it comes to digital works.
If this is, indeed, the case - and the courts do decide that digital works aren't covered by it, that really opens up a whole can of worms.
Among other things, it means Microsoft is right after all, when they want to stop you from reselling unopened/unused OEM versions of their operating systems that were originally bundled with new PCs. (First Sale doctrine is the main argument people had in their favor, when trying to recoup money lost when they were forced to buy their new laptop or desktop system with Windows pre-loaded on it.)
Even the "personal use" exception seems to be under fire these days, as the publishers of digital works keep trying to find more ways to milk extra $'s from people (DMCA, etc.).
Unless things change, one of these days, you just might find it has become illegal to practice existing music without paying for a "musician's license" from the recording industry. (We're sorry, but without a license issued by the original copyright holder - you're simply engaging in attempted illegal reproduction of our copyrighted works, Mr. Musician!)
Hmm. Let's see here.
I have, in my hand, a copy of a Harry Potter book.
In my other hand, I have a digital camera. Watch, as I take a photo of page 52.
Oh my, it appears the text is readable. Here, let me just share this out on Kazaa... (As a matter of fact, most popular books are shared right now)
What was the difference again?
Reality check here. Copyright applies to patterns of information. ALL patterns of information can be digitized and copied at (practically) zero cost.
The real difference here is that the book publishers' war to outlaw libraries, used bookstores, and reselling was lost centuries ago. Nobody will even take them seriously if they try to put that genie back in the bottle.
Meanwhile, the RIAA/MPAA/BSA etc. still think they can win and create a world where they control all sales and uses of their products, and thus can have absolute control over pricing. If they beat the "new, digital era" drum loudly enough, they think they can get new laws rammed through guaranteeing their profit margins forever.
Sadly, it looks like the governments of the world may actually be so stupid as to let them.
Creating such a marketplace and policing it would take considerable time and effort. Just figuring out how to track how many times a song had been sold (and making that count hack-resistant) would be a big task. The margins would be lower than the iTunes Music Store, and there would be all kinds of litigation just waiting to be sprung on their ass.
Plus, there's already an 800-lb gorilla in the online auction world. They're called eBay, and they've already shown that they'll squash anyone who tries to enter that market.
Such a marketplace might be nice for a few consumers, but I doubt that most music lovers would be interested in bidding on individual songs. The genius of the Apple Music Store is that it makes it ludicrously easy to purchase, download, and use music. Adding more complexity to the equation would erase that advantage and confuse their customers.
Read the EFF's Fair Use FAQ
Again apple shows other corps how to play.
Business and ethics can mix; but don't in modern times. Its nice to see some companies still doing things right. All these corporate terrorist lawyers are messing up the world ("civilally.")
Where did the old saying go?
"Its not wether you win or lose, its how you play the game."
Apple is 1 of a few who remember this. This is just another example of Job's influence; and also why apple will never win.
Democracy Now! - uncensored, anti-establishment news
Think about it. If there existed a tool that could remove copy protection from an AAC file, what would be the result?
1) Some would argue that it is a useful tool that facilitates the legal owner of a digital work in their right to re-sell the work. Much like DeCSS was a tool that facilitates a legal owner of a digital work in their right to access it.
2) Others would argue it's an illegal violation of the DMCA that enables piracy by allowing someone who may be the legal owner of a digital work to then distribute copies of that work. Much like DeCSS was a tool that allowed a legal owner of a digital work to distribute copies of it.
The big question: Will the result be different when we are talking about music instead of movies? Would people see the logic in being able to have full access to their digital library?
When iTunes Music Store was announced, it would have been a complete flop except for one thing: Apple had successfully negotiated what seemed like very generous DRM terms for their customers. Compared to the other options, most people were happy to plunk down their dollars and reward Apple. But no one bothered to ask what happens when someone wants out and looks to offload their collection.
If Apple were to continue its example, it would provide users with a mechanism to transfer songs. If Apple does not or cannot provide this...then really it's terms are not as generous as they advertise. There might be a compelling class-action lawsuit in this. Apple never said they prohibit the transfer, but they are the only ones capable of performing a transfer without encouraging their customers to use DeCSS-type tools that violate the law.
What would happen if everyone who purchased music on iTMS told their credit card companies to dispute the charge because they didn't actually get the legal copy they expected? Maybe someone should try it as a test case like this resale.
- JoeShmoe
.
-- I wonder which will go down in history as the bigger failure: the War on Drugs or the War on Filesharing
Is that the eBay guy is sill $0.50 ahead buying a $0.99 song that he doesn't like and not being able to resell it, rather than buying a $3 single he doesn't like and selling it back to a record shop for $1.50. Easy and practical resale is one of the advantages you get for shelling out the extra cash for a physical copy (and of course there are a lot of disadvantages to physical copies as well).
"Reality is just a convenient measure of complexity" -Alvy Ray Smith
Wrong. They will by no means be required to facilitate a free transfer function. Just because you have the right to do something doesn't mean that they have to help you do it---and certainly not for free. That would be like saying that a record company should pay your postage if you sell your CD over eBay.
I think you could do a pretty good case when you show that Apple is refusing to acknowledge a change of ownership in their DRM, and so directly ignore the doctrine of First Sale. If you want the physical analogy, it would be having the right to sell your propery - only it is biometrically locked to you. And you have a company that can modify that lock, only they refuse to do so stating they have no legal obligation to help. Do you think that would be acceptable?
Kjella
Live today, because you never know what tomorrow brings
The way iTunes DRM works makes things much simpler and less controlling but also takes away the user's ability to transfer songs. When you download a song, Apple attaches a DRM "lock" to the actual music file. Then, when you register your computer with Apple they give you the "key." That way, you only need to be online to get your computer the key. Other than that, iTunes never phones home about any use of the songs. In order to transfer a song, Apple would need to make the original purchase invalid and create a new one. There is no way to invalidate just one purchase under the system. You'd have to give the buyer your whole account. Or yourself a whole new account. Even then, you could easily keep all your old (and sold!) music on another machine that hasn't synced to the internet. The beauty of Apple's system is the freedom it gives the user, like true ownership. No cage comes down around the music if you have no network connection.
On the bright side, let's say you want to unload your whole collection of music. You could literally SELL your whole account with all your music after removing your credit info. Now that seems like a realistic sale. Selling just one song 99 makes little sense. Selling hundreds to someone who likes your taste just might work very well. The buyer of your account would know if you were still holding on to an authorization key because iTunes would tell them so.
And is still used on some rom-swapping sites these days. But it's more of an urban legend than anything else since - correct me if I'm wrong - it has no legal weight at all. Instead this '24 hours and delete' has become a particularly hard to kill meme which a great many people seem to believe but in actual fact is pretty much untrue.
This is the most important thing that has every been said by a company on this issue. It basically admits that the way to fight piracy is to create a market environment where there is little incentive for piracy. And how do we do that kids? By lowering the freaking prices and making the product more accessible to the consumer. Thank you Apple.
It's 10 PM. Do you know if you're un-American?
So my roommate, who works with some high-end audio software that runs on a Mac discovered something interesting.
If you open an iTune with a particular piece of editing software on the Mac, and click save-as, no more DRM.
I would tell you the name of the product, but I don't remember it (not being an audio nor Mac geek myself). It costs in the $800 range but you *can* find it fairly easily in a semi-pbulic lab at, say, a school has a good audio engineering program.
And no, the arangement doesn't require that you buy the iTune for the computer running the software.
(I really wish I could say that I was withholding the name of the program because of the DMCA, but I am just a big dummy and I cant remember.)
Then again, said "big" corporation making and marketing the "cimcumvention tool" which is also "one of the big names in Digital Audio Production" would make for interesting conflict of interests.
Do you think Lars be happy to know he is using the same software to master his music as the random college hippies are using to steal it?
And no, my roommate is not using this discovery to violate anybodies copyrights, he just mentioned that he'd found the flaw by accident and that it was funny...
Innocent people shouldn't be forced to pay for inferior software development.
--"Code Complete" Microsoft Press