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Thursday News: Amazon awarded digital resale marketplace patent; Baldur Bjarnason argues...

As I wrote last September:

Using ReDigi’s software, an “eligible file” is moved from the harddrive of the user to a ReDigi storage locker. The user can then stream, download or offer the “eligible file” for sale. Eligible files are determined to be music purchased directly from iTunes. No tracks copied off CDs or downloaded from other vendors or fileshares are permitted to be offered for sale. The user can only sell that eligible file once on ReDigi.

To use examples, if I buy “Stronger” by Kelly Clarkson from Amazon, I can’t resell it using ReDigi. If I buy the song from iTunes, I can but I am only allowed to sell “Stronger” once.

When the sale occurs, ReDigi transfers access to the song from the buyer to the seller. ReDigi’s software continually scans the harddrive of the buyer to make sure there are no copies of the song. If ReDigi finds a copy, it prompts the user to delete it. If the copy is not deleted, ReDigi suspends access to the user’s entire ReDigi account. ReDigi argues that in this way, no actual copies are made because only one copy exists on ReDigi’s storage locker and the users are simply buying and selling access. This is what is contemplated by the Australian company Book.Ish and what is actually taking place in the online cloud based videogaming world Steam.com.

Amazon applied for a patent for a resale marketplace for used ebooks, apps and songs in 2009 and was awarded the patent on January 29, 2013. The patent, which Amazon filed in 2009 and won on Jan. 29, imagines a digital resale marketplace where users can trade “digital objects” like e-books, songs, videos and apps. According to the patent, these items would live in the user’s “personalized data store,” presumably in the cloud. Selling a song would copy it to another user’s data store and delete it from the original owner’s. “ The Washington Post

 Monopoly cat

Jane Litte is the founder of Dear Author, a lawyer, and a lover of pencil skirts. She spends her downtime reading romances and writing about them. Her TBR pile is much larger than the one shown in the picture and not as pretty. You can reach Jane by email at jane @ dearauthor dot com

18 Comments

  1. library addict
    Feb 07, 2013 @ 07:26:09

    I liked the iron.

    Is there any patent Amazon doesn’t own nowadays? /sarcasm

  2. Sheryl Nantus
    Feb 07, 2013 @ 07:45:39

    Can I just say that I think “Baldur Bjarnason” would be an AWESOME name for a role-playing dwarf?

    XD

  3. carmen webster buxton
    Feb 07, 2013 @ 08:08:54

    I agree with @Sheryl Nantus on Baldur Bjarnson. Speaking of author names, did you see this article on a British grandfather outed as a romance writer? He sounds like a sweetheart! http://www.dailymail.co.uk/femail/article-2274519/Female-romance-author-Jessica-Blair-unmasked-89-year-old-war-vet-called-Bill-Spence.html#axzz2KDpNfYhd

    Also, I would have tossed the shoe and kept the iron. It was educational, as it was the kind you had to heat in a fire. I like the cat, though.

  4. Rebecca (Another One)
    Feb 07, 2013 @ 09:18:15

    I like the cat and the iron, I would have tossed the thimble.

  5. Charming Euphemism
    Feb 07, 2013 @ 10:09:27

    Maybe it is a good thing Amazon got this patent. Maybe they will enable reselling ebooks. Perhaps with a small additional royalty to the author?

  6. Jeaniene Frost
    Feb 07, 2013 @ 12:14:15

    Regarding Amazon’s patent for resale of “digital objects,” was there any mention in the patent (or somewhere else) of a proposed limit on the number of times a single digital object could be resold? Unlike physical objects that get worn down with repeated use, a digital object suffers from no “wear and tear” and thus has the potential to be resold innumerable times.

  7. Jane
    Feb 07, 2013 @ 12:20:14

    @Jeaniene Frost: This is a business systems patent and doesn’t contemplate the details. Here is the patent: http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PALL&p=1&u=%2Fnetahtml%2FPTO%2Fsrchnum.htm&r=1&f=G&l=50&s1=8,364,595.PN.&OS=PN/8,364,595&RS=PN/8,364,595

    I foresee this happening one of two ways (and let’s remember that this patent approval happened independent of Amazon’s actions this year. The patent application was filed in 2009 and it was just recently approved by the USPTO).

    1) ReDigi wins and Amazon sets up a system similar to the ReDigi system. If you read the details of the ReDigi program, it is really intrusive in that you allow them to constantly scan and monitor your harddrives.

    2) Amazon sets up secondary marketplace as an option for getting the 70% royalty, kind of like the KDP Select program. Authors voluntarily participate and are then awarded some kind of percentage royalty from the resales.

    There are probably others, but that’s a couple I foresee now. I guess I’m surprised that people haven’t thought about used digital book marketplaces in the past, particularly with ReDigi (the suit has been going on for over a year now).

  8. Courtney Milan
    Feb 07, 2013 @ 12:26:37

    @Jane:

    Actually, Jane, I think you’re wrong. One of the patent claims is explicitly directed at a limited number of sales.

    This is claim 2:

    The system of claim 1, wherein the one or more business rules comprise a move limit business rule, and wherein authorizing transfer of the used digital object further comprises: initializing an object move counter to count a number of moves of the used digital object between personalized data stores; setting an object move threshold, the object move threshold defining a number of times the used digital object can be moved; applying the move limit business rule stored in memory to determine whether to authorize or deny the request for transfer of the used digital object, application of the move limit business rule comprising: querying the object move counter to determine a number of times the used digital object has been moved; comparing the object move counter to the object move threshold; denying the request for transfer of the used digital object as impermissible when the object move counter of the used digital object exceeds the object move threshold; and authorizing the request for transfer of the used digital object to the second personalized data store when the object move counter of the used digital object is within the object move threshold.

    In my reading, this is directed at a resale system where the digital good can be resold a limited number of times.

  9. Jane
    Feb 07, 2013 @ 12:28:13

    There could also be tiered pricing, although Amazon might not want to do that because it would be confusing to the reader but a) a higher price for lending and resellability (kind of like airline tickets where you are charged more for a refundanble/changeable ticket) and b) a lower price for a DRM free, but non resellable book.

    Book.ish talked about this when it launched back in 2011: http://blog.booki.sh/blog/post/it-s-nice-of-you-to-say-but-we-re-probably-not-the-horsemen-of-the-apocalypse

    Book.ish is an Australian company. (Not to be confused with Bookish.com run by the three US publishers)

    Edited to say that “yes Courtney, you are right that the patent application has more detail than I stated originally.”

  10. Jane
    Feb 07, 2013 @ 12:29:33

    @Courtney Milan: I think that, like lending, would depend upon the publisher/authorizer of the book. I don’t think it means that you have to limit the number of sales, but only that it could be limited.

  11. Jeaniene Frost
    Feb 07, 2013 @ 12:30:58

    @Jane. Thanks for the link. I found this sentence in it reassuring: “When a digital object exceeds a threshold number of moves or downloads, the ability to move may be deemed impermissible and suspended or terminated.” I’m sure publishers, record companies, and artists will be very interested in finding out exactly what “threshold number” translates to, but in the meantime, it’s nice to know that limitless resales aren’t being proposed.

  12. Courtney Milan
    Feb 07, 2013 @ 12:41:16

    @Jane: I didn’t mean that you were wrong about any of the implementation mechanisms. I take no stance as to whether this will be implemented, and if it is, which version will be implemented.

    I only meant you were wrong in a very, very tiny limited way–when you answered Jeaniene’s question about whether there was a proposed limitation on number of transfers. Your answer was that the patent didn’t contemplate the details, but that particular detail was one that it explicitly contemplated. So, wrong on one teeny tiny detail. The rest of your speculation, I grant as reasonable. :)

    The more I look at it, the screwier this is. Claim 12 appears to contemplate all cloud storage of digital downloads. I need to actually draw this out to see if I’m right. WTF, PTO.

  13. Jenny
    Feb 07, 2013 @ 15:28:41

    Personally, I would never use something that is continually searching my hard drive. It seems incredibly invasive and I have to question the effects it would have on the performance of my computer. Not to mention that it kind of gives me the creeps.

  14. Ann Somerville
    Feb 08, 2013 @ 00:30:18

    For once, I am firmly in John Scalzi’s camp*:

    In the event that Amazon (or anyone else) gets into the business of selling used eBooks without compensating me (the author) for them, and you decide that you don’t want to buy the book new (i.e., I’m not going to get paid anyway), you know what? I would rather you pirate the eBook than buy it used. Because if you’re not going to pay me, the guy who wrote the book (or also the folks who edited it, did the cover art, marketed it and put it out there in the first place), why the hell should Jeff Bezos get paid?

    (*as with DA, I am often hovering around the camp, enticed by the warm smells and interesting noises, but not actually interested in being *in* the tents. In this case, Scalzi has nailed it perfectly.)

  15. Susan
    Feb 08, 2013 @ 02:19:20

    I like the cat (and voted for it) but I’m very surprised it won. I would have bet on the robot.

  16. FD
    Feb 08, 2013 @ 04:17:08

    I’m wondering if Amazon are thinking of a cloud based secondary tier marketplace for digital reselling. e.g. you get three
    buying options on first purchase; regular sale: higher price + ability to download but no resale option, drm’d / watermarked sale: higher price + download + resale option, or a resale/cloud sale: cheaper price + resale option but no downloadabilty.
    I can’t see how they can make it work with content not originating from Amazon though, not without massive industry wide consensus on drm and watermarking, and cross platform device access and all of those things seem a bit unlikely to me at the moment. And that’s even without considering royalties and resellers fees and taxes and all the other malarkey.

  17. Jane
    Feb 08, 2013 @ 07:22:51

    @Ann Somerville – I don’t understand that mentality. As an author, you would rather encourage someone to steal your book (and at that point, can it really be stealing since you as the copyright holder are giving consent to its distribution to a channel that does not require payment) than encourage readers to purchase books, even at a lesser price? The right of first sale exists for print books and has since the inception of the Copyright Act. Is this how authors feel about used book stores chains like Half Price or a local used bookstore? Those individuals and businesses are getting paid without any compensation to the author as well.

    If anything, I think the news of the USPTO’s approval of a patent Amazon applied for three years ago reveals some interesting opinions authors have about their content and the Copyright laws.

  18. Ann Somerville
    Feb 08, 2013 @ 15:06:00

    @Jane:

    ” As an author, you would rather encourage someone to steal your book (and at that point, can it really be stealing since you as the copyright holder are giving consent to its distribution to a channel that does not require payment) than encourage readers to purchase books, even at a lesser price? ”

    I would rather people shared books (or sold them between themselves) than a third party who’s done nothing, makes money out of it while the author doesn’t.

    I’m a big fan of used book stores, libraries, inter-reader lending and non-DRM’d books. I’ve encouraged lending, and all my self-pubbed books are available at nominal costs to all American libraries through the LibraryDirect scheme in which Smashwords participages (and note, that’s an opt-in scheme. I don’t *have* to do this at all just because I’m at Smashwords.) I have given away many copies of books to fans who are short on cash, having trouble buying my books, or just because they’ve been strong supporters.

    None of my books, whether self- or pro published, have DRM on them, including those on sale at Amazon, and that’s how I want it, for all the reasons you have repeatedly championed here, and more, including the fact I am a reader too and I know what it’s like not to want to risk good money on possible rubbish.

    The problem with Amazon’s idea is that it may not pay anything to the author (we don’t know if this is the case) and unlike with print books, it’s entirely possible and entirely likely that the ‘owner’ of the ebook will still retain a copy (thanks to the widely available DRM cracking which you have frequently championed and advertised here, and which indeed I have also used) while selling. That’s not adhering to the principle of first sale. Thus Amazon are essentially charging a reader a fee for being a file sharer – and yet that reader could get a DRM free book from a file sharing site for nothing.

    Like Scalzi, I’d rather people paid me than Amazon (and my books, being a max of $6 or so, with most being $2.99 for full length novels, are cheaper than most pro-pubbed ebooks), and I would rather people paid nothing than pay Amazon for a ‘used’ book with DRM.

    “Is this how authors feel about used book stores chains like Half Price or a local used bookstore? Those individuals and businesses are getting paid without any compensation to the author as well.”

    UBS have to pay for the stock and to store it and market it. They buy the books in, they pay leases for store frontage, staff to curate the books etc. Same with a physical remainders store (aren’t authors paid for those books in their advances though?) Amazon’s costs are in setting up a DRM system which I profoundly disapprove just to protect *their* cut (not mine), and raking the cream off the top. Why should they profit from what I as an author do not just for that? Why should readers subsidize a system which works against their ability to share books they’ve bought?

    Amazon’s plans don’t seem to represent a good deal for customers or authors. At least file sharing means the customers get ‘second hand books’ for free. So yes. ‘Steal’ if you must, rather than be ripped off by Amazon, if you can’t afford or don’t want to pay the low prices I charge for my books.

    I can’t speak for other authors, and you of all people would realise I am hardly representative of the majority. These are just my feelings.

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