At present, digital ownership and copyright is a complicated issue, a fact made clear during an educational briefing hosted by the Congressional Internet Caucus Advisory Committee (ICAC) on June 13th. The panel included industry representatives Sandra Aistars, CEO of Copyright Alliance, and Keith Kupferschmid, senior vice president of the Software and Information Industry Association (SIIA).
Their stance was that the first sale doctrine only applies to tangible goods, and any changes in the copyright law to reflect a “digital first sale” were unwarranted. Their primary assessment was that the market for digital copyrighted materials was successfully providing a variety of services for digital content, and, that as business models further developed, the market would determine what is best for the consumer.
Also on the panel were Jonathan Band from the Owners’ Rights Initiative, and University of Maryland Professor of Law James Grimmelmann, both speaking to consumer protection and how digital copyright restrictions can exist outside free market constraints, especially in the educational sector. Band spoke to the misleading nature of “purchasing” digital materials online, such as from iTunes, in which the consumer believes they own a good that they are in reality leasing. Aistars and Kupferschmid posited that consumers are willing to accept these limitations given the increased accessibility that digital copies offer.
Band countered with the assessment that purchasing digital items such as movies or music is like buying something with a string attached, in which the vendor can yank the purchase back at any time, or alter your rights to use it. Issues of digital copyright can also negatively impact libraries and universities, or closed markets where the laws of supply and demand are heavily constrained. Indeed, while the general public may see a modest difference in price between digital and physical copies of books and music, libraries see a considerably wider gulf, with ebooks costing upwards of four to six times (pdf) as much as their physical counterparts.
Digital first sale becomes even more complex when one considers how many common physical devices increasingly include software. Beyond just ebooks and iPods, our automobiles, thermostats, fire alarms, phones, and other appliances now include licensed software that could restrict use to only the registered (first) owner of the object. Even the most common downstream market items are at risk of shifting from an ownership to a rent or lease model.
Textbooks are the most visible of these items; as Grimmelmann noted, not only are electronic textbooks as expensive (sometimes more!) than printed textbooks, some publishers have even tried to build in an automatic return clause for physical book sales, in which students return the textbook to be pulped at the end of the semester to reduce secondary markets for used textbooks. This is in addition to standard restrictions on what students can and cannot do with electronic versions of the same textbook.
At the end of the day, no one could directly answer the basic question of the day: Can I sell my iPod and the digital music files thereon? But the panel certainly demonstrated just how diverse the range of interested parties really is when it comes to first sale protections for digital goods.
Abby Lull and Margaret Kavaras contributed to this article.