Testing The Right To Resell Downloaded Music

David Gerard writes "A man has bought a song from Apple iTunes and has put it up for sale on eBay. "I only spent $0.99 on it but I bought the song just as legally as I would a CD, so I should be able to sell it used just as legally, right?" Does the Right of First Sale still exist?" The seller says he's seeking attention, but not to himself. Rather, he calls this "an experiment in property rights in the digital age," and promises not to keep a copy once the sale is done.

Article text (already slow to subscribers)

Does the Right of First Sale Still Exist?

I just posted an eBay auction [ebay.com] for a song I bought from the iTunes music store [applemusic.com]. It should be interesting to see how this works out. I only spent $0.99 on it but I bought the song just as legally as I would a CD, so I should be able to sell it used just as legally right?

[Update 09-03-2003 10:08 AM] Right now I've come up with a couple ways that the transfer of ownership could take place. One is to call up Apple and ask them to do it for me, which would be an interesting call. The other way would be to give my account to the winning bidder, which doesn't seem like a bid deal considering that I've only purchased one song. Still, I'd have to make sure that my credit card info was completely disassociated with the account. Or I could just create a new account and repurchase the song on that account.

[Update 09-03-2003 11:25 AM] I'd like to respond to a few points made by people: 1. It's true that I'm seeking attention, but not for me personally. This is an experiment in property rights in the digital age, something that's gotten surprisingly little attention. 2. I've read the iTunes agreements and found nothing denying transferability. This isn't any more a commercial venture than selling CDs at the local music store, I'm not incorporated or even DBA. Furthermore, in case anyone thinks this is a cheap way to make a buck I will be donating all proceeds to the EFF [eff.org]. 3. When the song is successfully transferred, I will not be keeping a copy of the song. If I don't own it I shouldn't have a copy.

[Update 09-03-2003 11:25 AM] A very excellent comment below by Piggly Wiggly asks if I will convert the format for delivery. My answer right now is "no" because I don't want to cloud the issue of the sale by changing the format. Also, I'd like to thank all the people posting supportive comments who realize that this is about more than a $0.99 song being over-valued on eBay.

Huge profit

The high bid is currently $20.50. I'm sure that a few lawyers who want to get involved in the case will pump this bid sky high. It may be worth $20,000 to some lawyer trying to get famous. It's just speculation now, lets see what happens.

Re:Huge profit

It's up to a whopping $300 now!

I wish I had thought of this...

Re:Huge profit

According to the RIAA, the song is at least worst $150,000.

Donate the proceeds to the EFF? Hah!

More likely the EFF will have to come save him when his proceeds don't nearly cover the legal bills associated with defending the lawsuit some scared industry association throws at him.

Re:Article text (already slow to subscribers)

Right now I've come up with a couple ways that the transfer of ownership could take place.

It's simple. I've already moved an iTunes purchase to a second computer. You just have to enter your Apple ID and password on the second Mac to authorize it. Now, here's the fun part: once somebody has your Apple ID and password, he can go hog-wild at the Apple Store online, buy anything he wants, and it will be charged to your credit card. This includes hardware and software purchases too, not just iTunes music. So, in addition to deleting the original file from his computer, the seller will first have to:

1. De-authorize his computer from iTunes (so that the song will have its full, legal ability to be authorized on three machines)
2. Copy the file to whatever media he's using for transfer
3. Delete the original
4. Cancel the credit card used to purchase the song
5. Send the song, the Apple ID and password to the buyer

Simple!

Re:Article text (already slow to subscribers)

It also forces you to re-encode an already encoded file, both times lossy. Which isn't a very good idea, since it causes bad artifacts. (Unless AAC has some means to get around this - I guess it's conceivable, but I doubt it.)

Re:Copyright Law Forbids This

No it doesn't. Do a google search for the term "Right of First Sale". The copyright law and Supreme Court decisions indicate that the copyright holder gives up all rights to control subsequent sales after the first sale. There are also special exemptions for Libraries, etc.

The copyright law prohibits someone from selling reproductions, but Right of First Sale dictates the disposition of the object afterwards.

The question here will be how Right of First Sale applies to a digital recording that was never originally distributed on any kind of media.

This decision might also affect the validity of other digital recording "licenses" like computer software, etc.

Re:Article text (already slow to subscribers)

This is likely to cause a rather serious problem for our fair hero. Excerpted from http://www.info.apple.com/usen/musicstore/policies .html CONTENT USAGE RULES Your use of the Products is conditioned upon your prior acceptance of the terms of this Agreement. You shall be authorized to use the Product only for personal, non-commercial use. You shall be authorized to use the Product on three Apple authorized computers. You shall be entitled to burn and export Products solely for personal, non-commercial use. Any burning or exporting capabilities are solely an accommodation to you and shall not constitute a grant or waiver (or other limitation or implication) of any rights of the copyright owners of any content, sound recording, underlying musical composition or artwork embodied in any Product. You agree that you will not attempt to, or encourage or assist any other person to, circumvent or modify any software required for use of the Service or any of the Usage Rules. The delivery of a Product does not transfer to you any commercial or promotional use rights in the Product. Refer to Terms of Sale for more detailed information on Usage Rules.

Re:Article text (already slow to subscribers)

I don't see anything in there forbidding transfer of the license; it seems to be more concerned with unauthorized duplication and commercial use. Of course, now that this is getting attention, I'm sure the terms will quietly be amended to explicitly state that the user is purchasing a nontransferable license, but there seems to be some wiggle room in there at present.

Re:Article text (already slow to subscribers)

IANAL, but it's not a problem. Sale of a personal property is not a commercial usage because how can one use something that he is parting with? As another example, CDs are also authorized to be used non-commercially, but it is legal to sell a used CD.

Commercial usage would occur if you, for example, play the song in your bar, or broadcast it through your own radio station. None of that applies here.

Re:Article text (already slow to subscribers)

Who cares what the EULA says? If Ford decides to disallow reselling cars to prop up new car sales, would anybody obey them? Just because the seller desires something doesn't make it so.

Re:What is legally happening here?

the relevant question is not what he considers to be copying, but what the law does.

A very good observation. I believe it is illegal (ie, against copyright law) to reproduce a work through any type of copying. This would be similar to photocopying a book, burning the original, and selling the copy to someone. It's the very act of copying the work that is illegal because you were not given the right to reproduce the work. Here's the relevant section of the code [copyright.gov]:

106. Exclusive rights in copyrighted works

Subject to sections 107 through 122, the owner of copyright under this title has the exclusive rights to do and to authorize any of the following:

(1) to reproduce the copyrighted work in copies or phonorecords;
...

(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending;

So, since only the original author has the right to reproduce the work it would be illegal to reproduce it. If the iTunes music store specifically gave you the right to reproduce the work then you could make a million copies. However, you would then run into section 3 of the code quoted above, which says that only the owner of the copyright can transfer ownership of a copy of the work.

A very thorough and much more involved look at the First Sale Doctrine can be found at the Duke Law & Technology Review article: "THE FIRST SALE DOCTRINE AND DIGITAL PHONORECORDS" [duke.edu]

Re:What is legally happening here?

The courts have ruled that mere possession of the physical medium does not imply license to use, as does the possession of a book or musical recording, because to make use of the digital data it must be copied into memory first and that copying is covered under copyright law as restricted. Thus you need a license to copy that which you have already purchased for use.

Bull-hockey. The courts have ruled no such thing. In fact, the copyright law specifically allows for this sort of "copying" the data into memory in the case of computer software or other cases where such "copying" is a necessary part of using the copyrighted work.

RTFM [copyright.gov]:

117. Limitations on exclusive rights: Computer programs

(a) Making of Additional Copy or Adaptation by Owner of Copy. -- Notwithstanding the provisions of section 106, it is not an infringement for the owner of a copy of a computer program to make or authorize the making of another copy or adaptation of that computer program provided:

(1) that such a new copy or adaptation is created as an essential step in the utilization of the computer program in conjunction with a machine and that it is used in no other manner, or

(2) that such new copy or adaptation is for archival purposes only and that all archival copies are destroyed in the event that continued possession of the computer program should cease to be rightful.

Re:Apple usage policy

Jesus, read past the damn headline... He already said there isn't anything in the agreement with respect to transfer.

Re:Apple usage policy

Whilst a new EULA would apply to new downloads (I believe the EULA says the terms can change at any time) it wouldn't apply to past downloads.(IANAL.)

Anyone have a copy of the EULA?

Sounds reasonable

This is hilarious. I'd like to see how the RIAA spins this. After all, they haven't ever whined about used CDs being sold.

Re:Sounds reasonable

Um, they've complained since day one about used CD stores. Numerous attempts were made to shut them down, and to make them illegal. Sure, it was ten plus years ago when most of /. was riding bigwheels in their parents driveways, but they most certainly DID do precisely that.

Re:Sounds reasonable

Actually here's an older slashdot story about record companies demanding royalties for used CD sales. They have always been SOBs and always will be: http://slashdot.org/articles/02/06/14/2111220.shtm l?tid=141

Son of a bitch.

I sold that song yesterday for $0.25. If I'd only known that I could post it to slashdot.

Slashdot, News for Nerds and eBay listings.

How much will he get for it?

Having seen Palm Pilots that went for $199 in stores go for $289 on e-Bay, it'll be interesting to see how high the price for a $0.99 song goes.

And, no, I haven't RTFA yet, I'm going to do that now...

Re:How much will he get for it?

Having seen Palm Pilots that went for $199 in stores go for $289 on e-Bay, it'll be interesting to see how high the price for a $0.99 song goes.

Let's just say that the profit margin seems to be a little bit higher on resold digital music.

Wait till all the venture capitalists find out!

DRM Restriction

Isn't it assumed that the DRM included in iTunes would disallow something like this even though it should be completely within the right of the purchaser/owner? I think this is another major problem with DRM technologies. They assume that the purchaser will desire to keep the media indefinately rather then sell it. Then again with the music industry already attacking used CD sales from cutting into their profit I highly doubt they'd want it any other way. What's better then forcing new copies of songs/albums to be purchased rather then continue the ability for it to exchange hands via a 3rd party at a possibly lower rate then the Music Companies would be willing to discount it to?

Re:DRM Restriction

That's only true if those terms and conditions don't violate existing law. My landlord can't, for example, enforce a clause in the lease saying that part of my deposit is automatically forfeit for carpet cleaning when I move out, even if the carpet is spotless.

She can TRY if she wants, and the clause can be there, but it's an illegal clause and thus is unenforcable, and I can take her to court in this state and get my money back.

There are some rights one cannot sign away, no matter what the TOS might say. The question here really is whether right of first sale is one of them.

Re:DRM Restriction

Sounds like some high-collection-rate loan outfits I've heard of. They don't bother with the signatures though...

Have you ever heard of the phrase "inalienable rights"? To allow people to give up their rights is just opening up the door for those with power to give folks an offer they can't refuse. Suppose all credit cards came with an indentured servitude clause?

Legal principles like first sale should take precedence over any contract made after the principle is upheld by a court. Since first sale was upheld a long time ago, that would include any contract dealing with digital media.

Every industry would love to get rid of the 2nd-hand market - it depresses prices. Gosh, if music fell under first sale you'd have cooperatives where everybody donates 10 songs to get access to the whole collection - as long as only one copy is checked out at a time it would be legal. Publishers would love to get rid of libraries as well - but that doesn't mean they're illegal.

Re:DRM Restriction

Suppose all credit cards came with an indentured servitude clause?

You mean yours don't ? Damn I'll have to get some new ones.

Re:DRM Restriction

That is incorrect, although a popular idea among business attorneys.

MANY rights can not be given up, no matter what you sign.

For example, slavery is illegal no matter what you sign.

Parental rights also are sometimes considered valid, even if you signed them away (as in surrogate parents).

The question is, is it possible to give away your right to sell an object and still be considered the legal owner of it. And that is very much up in the air. The right to sell is considered by many to be inherent to ownership.

Consider a bankruptcy case. Assume someone went was rich and had a huge collection of purchased songs, say 50,000 at $1. each. Would a judge be able to legally order those songs sold for? Or could the rich man say, no I can't sell them according to the TOS.

I think the TOS would be thrown out and the songs sold.

Unless in TOS, and maybe even then, you own it.

I think it's always been clear that virtual information, such as computer software, data and images that is copyrighted by an author is licensed to a user and not owned by a user.

If you go down to the shop and buy a DVD, you own it. Just as you own your copy of the book you bought. However, the copyright to the movie or the book text is not owned by you. That is the way it always has been since the dawn of copyright.

However, now that data (the text) can be separated from the medium (the book), they are trying push legally dubious ToS or EULAs to fool people into thinking just as you do - that you do not own your own copy.

You own a copy of the data - you have every right to sell that copy, even if it is no longer confined to the pages of a book or the surface of a disc. However, you do *not* have the authority to make copies and sell them. Or to sell the original and keep a copy.

Kjella

Re:DRM Restriction

The question is, is it possible to give away your right to sell an object and still be considered the legal owner of it. And that is very much up in the air. The right to sell is considered by many to be inherent to ownership.

That's the position I'm in with my left kidney and my right eye. It's my understanding that I own them, but here in the US I can't sell either. (especially not on eBay.)

Re:DRM Restriction

By clicking this you agree to ship us your first born postmarked within 48 hours (business days only). Click here for packing instructions.

Just because it's in a contract doesn't mean it's legal. Much less enforcable, moral, or in a sane alignment to the natural doctrines of the free market and capitalism. It just means another lawyer is off the bread line.

Re:DRM Restriction

I would have to say that, thanks to DRM, Apple doesn't give a shit what this guy does with the SONG FILE. They'll let him sell it for a penny or $400, or whatever he wants.

Because the file iteself is useless without the iTunes account that set it up. That's how this DRM works. The account is what unlocks the file and makes it play music. And I'm sure that accounts are non-transferrable, except among computers you yourself own -- and you wouldn't want them to be otherwise, since the account is connected with your credit card, and can be used to purchase more songs. That's the real protection, the thing really preventing people from spreading their iTunes files all over the net...the threat of misuse of their account. Shit, I don't even leave my iTunes sessions open anymore, because my wife once bought a bunch of Nick Drake CDs on my account(It's the same credit card, I know...I just don't want anybody thinking I listen to that crap).

So there's an issue here most people aren't seeing. There's a good and a service involved in this sale. The good is the file itself. The service is Apple's unlocking of the DRM.

When I got my house painted, I paid for two things: the paint (a good), and the painter's work (a service). When he was done, i got to keep the leftover paint. I didn't get to keep him, I don't have any control over what he does from now on. I can sell you the extra paint, but if you want to get it on your house you'll have to pay the painter. You can try and convince him that I paid for his unlimited service based on the paint he sold me, but he will probably just laugh at you...even if I promise to scrap all the blue off the house myself, and transfer it to you.

Isn't that what's going on here? The only confusion is over what the consumer's rights are, and what the medium is. Apple gave him a file and promised their services to unlock it an unlimited number of times to play it on his computers. If he gives it to somebody else, that's his own accord. The file is his to give. But the buyer shouldn't expect Apple to do anything for them. After all, they don't have a contract with Apple. Apple doesn't know the buyer from Adam, and if they don't want to perform a service for the buyer, they shouldn't have to.

That's the point of DRM

DRM is used to keep people from "abusing" the digital format and duplicating it all over the place, right? So you could argue that if DRM is there, it puts a set of rules in place, and if you're not breaking them, then it's okay.

Forget about what should or should not be legal. It's like the law -- how do you know if it's not okay to do something? It's against the law. Can I wear a fish on my head? Sure, it's not against the law. Can I shoot someone? No -- it's illegal.

By the same token: can I copy this file onto 4 computers? No, the DRM won't let you. Can I sell it to someone else? Well, if the DRM lets you, obviously it's okay.

Resell ?

An interesting point to consider is that,
Currently Apple doesn't allow download outside US, so if he is infact legally allowed to sale his bought music, then
Can he sell it outside US, at a higher price and make profit ?

Transfer?

My main question is how would the ownership of the file be transferred?

At the moment, the Apple Store lets you "authorize" music files. So for this person, after the file had been "sold", he would have to deauthorize the up to 3 other computers that had been allowed to play the song, give a copy of the file to the buyer, then provide them with his Apple iTunes Store username/password so they could authorize it on their machine.

As he mentions, he could call up Apple and ask them to switch his authorization of the song to another user.

Either way, it does raise an interesting question, and as someone who has been using the iTunes Music Store, I've never thought about it: Suppose that years from now, I want to sell all my downloaded music files to someone else. Is there a way to transfer the license? What if I left them in a will to my children later on - could Apple be required to ensure that they could use the files later?

Or he's about to run into a massive "legal agreement" which will negate his First Sale ability - we'll just have to see what happens, neh?

Re:Possible?

...Of course, legally if this is possible (which I believe it would be), he would be transferring ownership of the rights to that song making the iTunes copy he still has in his posession illegal...

I don't believe you are correct. His rights are assigned and associated to the iTunes file, not an ill-gotten MP3 he downloaded. Even if you buy a CD, according to copyright laws you are allowed to make one backup copy for archival purposes. That's why the RIAA has a leg to stand on in court. Even if you own the CD's, legal you can not download the MP3 from someone else. You rights are associated to your media, not someone elses media. Now if you rip the songs off of your media, and do not share them, then you are ok. As soon as you share them, or download someone elses, then you have violated copyright law, because the content you are using is not associated to your purchased media.

So if you sell the iTunes file, and then give the person the MP3, not only did he reneg on the iTunes sale (because the rights are associated to the iTunes file, not the MP3 you downloaded), but you just sold a pirated MP3.

Highest Bidders Name

The highest bidders name at this time is a guy called Unicks - judging from his name, I wonder how much trouble he's goiong to have to go through in order to play it :)

Re:TOS compatible

But donating $20 to the EFF doesn't seem moronic. RTFA.

I like freedoms and stuff very much but...

I don't think that in this case it should apply.

In my mind purchasing music in mp3 format should be a non transferable license.

I can see it now, people listing entire "Collections of high quality mp3s for $600! A $6000 value!" and promising to delete their files...

It just wouldn't work.

Re:I like freedoms and stuff very much but...

Yes but thats alot more effort and you can only sell the used CD once.

I could be wrong, but is there something that will prevent the files from being sold over and over again by the same person with all profits going to himself instead of EFF?

Re:I like freedoms and stuff very much but...

Yes true and all, except this guy has deliberately made himself *VERY* *VERY* high profile.

For him to pirate now is like slamming on your brakes screeching to a stop next to a cop car, flipping him the bird and then peeling out down the street in a Hazard Yellow Ferrari. You ain't going to blend into the background...

Re:I like freedoms and stuff very much but...

It is true that it would be near impossible to enforce this. A person could sell a copy and keep the original, and barring a legal seizure of his computer no-one would ever know. This is just like insider trading laws. Insider trading happens all the time and it is near impossible to prove. Insider trading should be illegal, and is. If we argue that we shouldn't be allowed to resell MP3s because some people may not delete the original, then we will have to argue that no-one should be allowed to resell stocks because some people may only buy after engaging in insider trading. You don't prohibit freedoms for law abiding citizens because it will be near impossible to prosecute law breakers. It's unamerican.

Re:I like freedoms and stuff very much but...

I don't think that in this case it should apply.

So do you don't believe that anything with intellectual property should not be able to be resold? Or is music somehow special?

Can I buy a copy of <insert software title here>, retail boxed at Office Depot, and then resell it?


In my mind purchasing music in mp3 format should be a non transferable license.

Is it an anti-competitive streak that wants to prevent a secondary used market from developing? (This was a huge monopolistic tactic that IBM used until the court made them stop it in 1956. See: "Big Blue: IBM's use and abuse of power".)

You did state a reason that people can copy and then resell used. So what? This has been possible for decades. So should we also ban used DVD's, Videotapes, Records, CD's, Prerecorded cassettes, 8-tracks, etc.?

What about books?

Magazines? Maps? Newspapers? Where does it end? Do you have some reason that MP3's somehow deserve special protection? Or is it only when a big corporation doesn't like it?

The reason that nobody respects copyright anymore is because of the behavior of copyright owners. See my earlier post on this [slashdot.org].

Okay, if you say I can't resell my Encyclopedia set, or my expensive book on Garbage Collection, or my CD's, or even my mp3's, then I'll just loan them instead of selling them. I'll offer my friends the use of my encyclopedia set, my expensive book, my CD's, DVD's, and even my mp3's. Yeah, I'm sure the corporations will love that.

When taken to it's logical conclusion, the behavior of copyright holders, and also of what you are advocating, is rather scary and draconian indeed.

So how do we ensure that I didn't secretly sell Joe my encyclopedia set? We did the dirty dastardly deed secretly behind closed doors. The encyclopedia set looks good in his house just like it did in mine. Can any stranger prove that those books weren't his to begin with? Similarly, we'll secretly sell mp3's. Heck, I'll just make you a copy and keep the original.

Is that your problem? We should only have draconian restrictions on things that are easy to copy? So what happens when it is easy to copy books? In the forseeable future, mightn't all information, including books be distributed digitally? Still it raises the frightening possibility that someone will want to control that I can resell a CD or VHS tape because -- gasp! -- I might have copied it. Is this concern worth the unwarranted intrusion to make sure that I do not have a copy anywhere?

Hmmm..

My only hope is he doesn't ruin the iTunes music store for the rest of us somehow.

It depends on the use.

I think if he buys the song then when he sells it he deletes his copy, This would be a fair use and trading. But if he downloads the song and sells many copies or keeps the original. Then that is moving into the range of illegal. This is a different animal then file swapping because money is trading hands. So if you download one song for $1 and then sell many copies then that is easily in the realm of music piracy. But I don't think this will go to far because this opens up a can of worms for legality and starting business that is almost impossible to enforce. If this were legal they will need to provide paperwork that makes a tax audit seem like a day at the peach.

Terrible Choice Of Song

Jeez, what a terrible choice for testing legal rights. Why couldn't he have picked something like "Money", "Fight For Your Right (To Party)" or "Equal Rights" by Peter Tosh.

Or maybe he's should pay the buyer to take the crappy song from his crappy collection of movie soundtracks.

Excellent

This is excellent and brings up quite a few legal questions.

Given that I'm not a lawyer though I'll just give my opinion (worth less than the original price of the song).

1) Unless it clearly states in the agreement made with apple, there is nothing preventing him from making this sale. He purchased the right to listen to that song in the specific format, it's his to dispose of as he chooses.

2) Making a sale for a profit in no way makes him a bad person (and he's claiming he'll be donating the money). I can't see how he could be legally required to pass this profit on to the original artist or to the supervising agency (in this case Apple who sold him the song).

3) The RIAA has nothing to do with this. As someone mentioned, they don't complain about the resale of CDs or DVDs (at this point) and there is no legal basis for them to in the future.

All and all I think this is an excellent way to bring attention to this issue. My only concern is that it will cloud the already muddy legal waters and make things more difficult for us lay folk to understand.

Cheers.

Coming soon to an OS X Mac near you...

"Software Update has found the following updates:

iTunes 4.0.2
Closes loophole in iTMS EULA which implies transferability of purchased music to a third party. It is recommended that all users of iTunes install this update."

Shipping?

Will ship to United States only.

Are there high email costs to other countries that make shipping too expensive?

Hmmm

You know, I'm all for having the right to purchase a song online. I love digital music. I never listen to my physical CDs anymore, just the ripped versions I created.

BUT...

* When you sell off a CD, you are selling a physical item and at least in theory that is some measure of protection against you keeping a copy after having sold it.

NOTE: This to me is an argument not for being able to sell "used" digital copies, but against being able to sell even used CDs anymore. When CDs came out the technology for consumers to digitally copy discs just wasn't there. Sort of like when the authors of the US Constitution were talking about firearms they were thinking muskets, not automatic rifles. The technology changed but no one realizes that the "rights" associated with them should also change.

* When you buy a CD or a digital song the artist gets some of that money. With digital copies the artist's percentage usually grows dramatically. When you resell that same item, the artist gets -nothing- out of the deal except for possibly a miniscule growth in fan base.

While the RIAA is a crappy organization, I believe they are going to go down just as inevitably all empires do. Let us not take the artists down with them.

Remember, you have rights to fair personal use, just like with software. But if you read the fine print selling that software "used" is often forbidden by the license terms. Perhaps artists and record companies will have to start defining similar terms. It certainly would not be hard at all to package digital records with a player, calling the whole package "software", the songs "content" and then being MUCH more restrictive on terms. Something like that will happen if people continue to try to erode the rights of the author and publisher. It is not all about consumer rights. Those publishers of digital music are trying to offer an alternative we've all been screaming for for years ... do we really want to turn them off of it now?

Bottom line for me ... if you're going to buy a digital recording online, do it from the source so that the artist gets their money AND it is made clear that online downloads are becoming more popular.

Re:Hmmm

When you resell that same item, the artist gets -nothing- out of the deal except for possibly a miniscule growth in fan base.

And can you tell me why they should? They've already been paid for it, why should they be paid again? When I sell my used car, should I have to forward a portion of it to Chrysler?

Remember, you have rights to fair personal use, just like with software. But if you read the fine print selling that software "used" is often forbidden by the license terms.

So don't agree to the license. As you said, you have the right to fair use, so using the software without agreeing to it is a non-issue. Unless the license grants me something that under copyright law I don't already have, I'd be pretty stupid to agree to it, wouldn't I? (Yes, I know that the license says that I can't use the software unless I agree, but since I'm not agreeing to be bound by the license, nothing it says matters.)

It certainly would not be hard at all to package digital records with a player, calling the whole package "software", the songs "content" and then being MUCH more restrictive on terms.

So I'll just ignore that license too. No big deal.

eBay policy

Here is what eBay says about such sales:

Downloadable Media Policy

eBay prohibits the listing of items or products to be delivered electronically through the Internet.

Examples
A copy of a software program which the successful high bidder can download from your Web site
Music or video files that you will deliver through a peer to peer file-sharing community or network
A copy of a downloadable eBook
A secret URL address where the high bidder can download "freeware" or "shareware" software programs

Doesn't seem like this is okay with eBay.

This is a CYOA policy

You'll notice Ebay doesn't ever seem to stop sale of Diablo2 and other online virtual items that can only be "delivered electronically through the Internet". It's just there so when seller X doesn't deliver to buyer Y, Ebay can say "You're not suppose to be bidding on that type of thing and he wasn't suppose to be listing that type of thing so tough luck."

Restrictions on changing format?

Posted by: Sack at September 3, 2003 02:08 PM
Interesting concept, except, there is a big flaw in you experiment.You need either an iTunes or iPod to listen to any song from ITMS. Only way you can give this song to anyone that does not have either one of these is by burning a CD, which I dont think you are allowed to do.

That was one of the comments posted on the website. Does anybody know if the contract/agreement actually prevents you from making backups for personal use? Aah, I see it now, just struck me: you are allowed to make as many copies as you want (of CDs, tapes or any media for that matter) for PERSONAL use. BUT you cannot sell the backups. You could go ahead and sell the original, but then you would actually have to destroy all the backups.

In the iTunes case, the guy would have to devise some way of selling the original version (not the backups on secondary media), which would be accessible only through iTunes or iPod.

Though this is just an experiment to test the current copyright laws, just the fact that you would need iTunes or iPod to listen to the stuff would prevent it from being a commercially viable practice, which could harm iTunes and the like.

It's not stated specifically in the terms.

The only thing close from Terms of Service [apple.com]:

You agree not to modify, rent, lease, loan, sell, distribute, or create derivative works based on the Service, in any manner, and you shall not exploit the Service in any unauthorized way whatsoever, including but not limited to, by trespass or burdening network capacity.

But that's only derivatives. The only mention close to this topic in the Terms of Sale [apple.com] is this:

All sales on the iTunes Music Store are governed by California law, without giving effect to its conflict of law provisions.

So there isn't anything specific about reselling it. However, if sold in the DRM version there's no guarantee the purchaser can unlock it, unless the seller shares his buying info and authorizes the other computer. Apple can probably enforce that - they are no obligation to authorize anyone other than the original purchaser. If he transfers it to CD or mp3 to sell/ship, then he probably would place himself in danger of prosecution as an unauthorized distributor of copyrighted work. {e.g. I probably can't take a CD, make a tape, and then sell that tape even if I then destroy the CD. - the physical equivalent of what he might try if the mp4 can't be transfered.)

Copy of the iTunes User Agreement

I copied the iTunes User Agreement.
It's available in PDF [mac.com] and TXT [mac.com] for your enjoyment.
I haven't read it over yet... but I bet this guy is just asking for trouble.

Re:Copy of the iTunes User Agreement

It's right there in the license: "3. Transfer. You may not rent, lease, lend or sublicense the Apple Software. You may, however, make a one-time permanent transfer of all of your license rights to the Apple Software to another party, provided that: (a) the transfer must include all of the Apple Software, including all its component parts, original media, printed materials and this License; (b) you do not retain any copies of the Apple Software, full or partial, including copies stored on a computer or other storage device; and (c) the party receiving the Apple Software reads and agrees to accept the terms and conditions of this License." -Paul

Why I Bid On The Song

For everyone out there who's wondering, "Why would you pay $20 for this song...geez!!", let me explain why I just put in a bid at $37.00 (username of schnarff over on eBay, too, if anyone cares to check).

This auction isn't about just getting a song -- I own no Mac hardware/software, so even if I won the auction, I couldn't play the song. It's about, as the seller says, testing basic rights in the digital age -- whether the (relatively) undisputed right of people to sell used CDs, etc. still exists when dealing with electronic formats. I figure, the more people who bid on this thing, the greater the interest will be shown to be in retaining basic rights in relation to digital media.

Besides, I know I won't win with the attention Slashdot is throwing at this thing, so the money is meaningless. That, and I wouldn't mind sending a $37.00 donation to the EFF anyway, since that's what the seller is doing with the proceeds of the auction. :-)

Profit!

1. Buy song for 99 cent.
2. Post on ebay.
3. Media blitz (tell slashdot money is going to EFF).
4. ???
5. Profit!

In order for 5 to work, guess what he has to do in 4.

What I've always wondered...

What if I buy a cassette of some album at a Thrift store, then is it legal for me to jump on Soul Seek and download it? Could I make a CD of the album and legally sell it with the cassette on ebay?

-Paul

how about the right to redownload?

While this example does demonstrate one of the short comings of digital music services, I think a more important issue is redownloading. If an Apple iTunes music service user happens to experience a hard drive crash, they must repurchase all downloaded songs that were not backed up. That's right, even though Apple keeps track of your purchase history, and even prompts to tell you that you are buying a song that was purchased before, iTunes users must pay again for the song.

Apple Apologists argue that its the user's fault for not backing up the song immediately after downloading and that a hard crash is the same as having a CD scratched or stolen. While there are many steps a CD owner can take to prevent scratches and theft, there is very little an iTunes user can do to prevent a hard drive crash from occurring. Backups are important, but short of backing up every song the minute you download it, there is no way to prevent people from getting screwed.

eBay can cancel this auction

In order to sell IP (software/music/etc.) on eBay burned to CD-R or in a downloadable format, you MUST be the legal copyright owner of said intellectual property and state it in your auction. I ran into this problem before selling my own software without the notice and eBay pulled my auction.

Check eBay's policies... They are well within their rights to end this auction. eBay generally tries to stay away from legal gray areas. Things that are actually legal to sell, for example, unprogrammed DSS access cards and Xbox mod chips with the Cromwell Clean Linux BIOS are not allowed by eBay to be sold. eBay is just trying to cover their own ass.

$320!!?!

With all this bidding you're going to convince the RIAA that their music might actually be worth the ridiculous numbers they use in their court cases. Then when cost goes up, everyone who hasn't purchased the new CDs can be sued, because the decreased sales must mean that everyone is pirating! Whee, slippery slopes are fun! :)

Right of First Sale helps the music industry

RoFS adds value to any physical media which you purchase, whether it is a CD, LP, etc. If you know you can resell an item, you are probably willing to pay more for the item than otherwise.

Some people think that by only purchasing used CD's, they are not supporting the RIAA. However, by creating a market for used CD's, full retail CD's become more valuable and this helps music companies' bottom lines.

If DRM can be made to easily co-exist with and encourage RoFS, then the perception of digital media files as a tangible good will improve, as well as the market value of digital media.

This Boggles The Mind

Not that someone wants to resell the music they downloaded but rather that someone is INVITING a lawsuit. Hey, IP lawsuits are the way I make my living, but I would NEVER suggest to a client that they become the test case unless it is the only way for said client to survive.

Simply put, this is one of the most idiotic things I have ever heard. I predict that Apple totally ignores this - and any/all other sales like it until a secondary market develops. Even then, I see Apple simply taking the position publicly that once it initially makes the sale, it has no further involvement with the process. I also predict an analogy to used record shops. By the way and for the record - I use Apple products in my home and work, but am not affiliated with it in any way.

$9,700 now, "this is a test, this is only a test"

Plenty of interesting posts out there on the topic (DRM, Apple, eBay bashing excluded)..

But the point I think many are missing is that this is explicitly an Experiment to see where it goes. I have to admit, selling an iTune on eBay sounds like some sort of smart-assed reply on /.

and this guy is actually doing it !

(of course, all proceeds if any going to EFF [eff.org]). Kudos ! and kudos to timothy for posting it.

The real issue is...

Ok people, how many "real world" ie. non-altruistic individuals would still keep a "backup" copy of the song after selling it on Ebay?

This is what the industry is afraid of and rightly so. If we didn't have 4 million Kazaa users freely swapping commercial songs, then the industry might not be so paranoid.

I know it's really easy to argue that our civil liberties are being trampled and I agree they are. But how do we fix the illegal file swapping AND maintain our constitutional rights?

My cynical side tells me that the situation will continue to develop into an us and them cyberwar. The anonymity and convenience of the internet facilitiates this. A legal battle will only serve to draw the proverbial line in the sand but will not change the situation until the two sides come together.

Does anyone agree that if music was more readily accessible (ie. iTunes), then most of us wouldn't be tempted to go to Kazaa when we really want to simply purchase the song. We don't want to drive to the store or wait for an online order to be shipped and we don't want to buy a whole album of crap along with it.

In terms of transferring songs. I have gigabytes of ripped songs from my vast CD collect on my computer. I filled up one hard drive so I buy another larger one and just copy the mp3s over. I haven't stolen anything or given anything away. What's wrong with this? The industry would make it so difficult to do stuff like this if they could.

Ok, I'm done.

M

$9,600??

Who would have tought Devin Vasquez was so popular!?

Now either someone mistyped a bid, or someone is philantropic here.

For the record, the bid is now at $9,700 and rising. It was at $360 not 10 minutes ago and $9,600 when I started this comment.

Go bidders! :)

Check his feedback!!

Potential scam!! The seller only has 1 feedback [ebay.com] and it's over 6 months old. It's only a A++++++++. I'd be careful of anyone who recieved less then 15 +'s in a single feedback comment. Buyer beware.

The Seller is going to get screwed

The auction (last time I checked) was almost at $10k. If the high bidder has no intention of paying (0 feedback, obviously fake ID) then the seller will have to pay ebay fees of, what, 5%? That's going to end up being around $500. (Sure, you can file a non-paying bidder alert, but those are a pain).

Then again, maybe someone really does what to make a point? It would be cool if the proceeds were to be donated to the EFF...

Auction's prohibited by Ebay rules

their lame policy [ebay.com] reads as follows:

Downloadable Media Policy

eBay prohibits the listing of items or products to be delivered electronically through the Internet.

Examples
Here are examples of items that may not be listed on eBay because of the downloadable media policy:

* A copy of a software program which the successful high bidder can download from your Web site

* Music or video files that you will deliver through a peer to peer file-sharing community or network

* A copy of a downloadable eBook

* A secret URL address where the high bidder can download "freeware" or "shareware" software programs

Guideline
If you are the copyright owner of the downloadable material that you are listing on eBay, make sure you say so in your listing!

Warning

Listings violating eBay's downloadable media policy may be ended early by eBay. Multiple violations of eBay's downloadable media policy could result in the suspension of your account.

Read more information on copyrights.

Unfortunately, the auction will be taken down soon...

Your filz ownz you. (BBEdit says so)

In BBEdit, I found no fewer than two times my name and iTunes user ID were in the hex dump of one of my purchased songs.

This guy can contend his interpretation of the License all he wants, but my interpretation of :

No portion of the Service may be reproduced in any form or by any means. You agree not to modify, rent, lease, loan, sell, distribute, or create derivative works based on the Service, in any manner...

from Terms of Service

is that he can't sell a work from the Service (iTMS). Not to mention that any transfer via email, upload, etc, entail making a copy as you send it. Finding prohibition of copying ain't too hard.

Tell Apple what we think!

At about 5:00, I called Apple, to get their opinion on this whole thing. They had no clue what's going on. What I did get from them was a number direct into their corporate headquarters (I had asked for PR or the legal dept.) This means we've got a prime opportunity to voice our opinions to Apple and hopefully sway them in a direction that will be favorable to all us /.ers.... Call them at 1(408) 996 1010 and simply wait for a rep or leave a message. Let's all urge Apple to support and embrace the resale of digital music. This could be a huge victory and give us ammuniton against the RIAA. Call Apple, tell them that they'd better not screw this up. Do the right thing, Apple.

Media catching stories from slashdot.

Several news sites have written articles on this, after the slashdot post. One even cites slashdot as the source.

Links:
http://www.neowin.net/comments.php?id=13369&catego ry=main
http://www.afterdawn.com/news/archive/4439.cfm
http://www.theinquirer.net/?article=11358

Won't be long now before ebay pulls this auction. No money for EFF.

The auction is legal, but worthless

This guy is selling the set of bits that Apple sold him. The problem is that those bits are combined with a service from Apple that makes them into something more than just bits.

It is like the (evil) Dish Network people and their receivers. Lets say I decide to quit using my equipment. I can sell the equipment, but not the agreement between Dish and I with regard to service needed to make good use of it.

The new owner of the equipment simply has the box, but needs to work with Dish in order to make it into something more than just an old box.

The iTunes service works the same way. If somebody actually pays the high bid in this auction, they are going to get a set of bits they cannot really use without a little help from Apple.

Since they have no agreement with Apple, they are going to need to enter into one. This will cost something of course, the price being about 0.99...

So, even though the owner of the bits has the right of first sale on the bits he purchased from Apple, selling them really is a waste of time.

What he should do is try and sell the iTunes account itself. That targets the Apple agreement in a more direct way that could actually result in something of value being transferred to the seller.

Re:Have no doubt...

Sadly, there's probably some truth to that. Since filesystems don't actually delete a file when you delete them, the residual bits of data would be the RIAA's biting point.

Re:eBay auction

As of 4:00PM Sept. 3, 2003, there are already well over 30 bids on the I-Tune, and bidding has exceeded $20. The original price was only $0.99. Very interesting.

Well, he is donating all of the proceeds to the EFF, so most likely people are just chocking the money up to a donation and bidding out of curiosity for the outcome.

Re:eBay auction

I hope the winning bidder is a lawyer!

Shoulda been Metallica...

...that would have been damned funny. ;)

Suck on this, Hetfield.