digital resale

The New York Times ran an interesting and fairly informative feature story on March 7; it covers the digital publishing industry’s current digital resale controversy, which was sparked largely by the work of John Ossenmacher, the founder and CEO of ReDigi — a company that refers to itself as ‘The World’s First Pre-Owned Digital Marketplace.’

The story includes a brief quote from Free Ride author Robert Levine; the quote probably does a better job than anything I’ve read before of explaining why digital resales will almost certainly lead to a fair amount of market insanity. As the article’s author, David Streitfeld, writes:

digital resale
John Ossenmacher

Levine … said he believed there was a cultural imperative to loosen the restrictions on digital entertainment — but not too much.

Before the Internet, [Mr. Levine] pointed out, there was little controversy over secondhand stores for books and music. “It never threatened the broader market because it simply wasn’t that efficient,” [Mr. Levine] said. “You couldn’t always find the book or CD you were looking for.”

Amazon, which caused an uproar with writers and publishers when it started selling used books in 2000, made it as easy as clicking a button. “Digital resale would change it even more,” Mr. Levine said.

Markets usually move toward a solution both sides can live with, he noted. “But that happens slowly, and in the meantime we’re in for one hell of a fight.”

digital resale
Robert Levine

There are other interesting viewpoints presented in the article, including the suggestion from Scott Turow, a best-selling fiction writer and the president of the Authors Guild, that “the resale of e-books would send the price of new books crashing. Who would want to be the sucker who buys the book at full price,” he said, “when a week later everyone else can buy it for a penny?”

The image at the top of this post, by the way, comes from the same Times article; it’s a diagram that accompanies Amazon’s secondhand digital exchange patent.

Click here to read the story, and don’t miss out on the rather impassioned (and occasionally informative) reader comments beneath it.


  1. 1) Both Amazon’s and Apple’s patents rely on DRM. Why not get rid of the DRM?

    2) Applying for a patent does not mean that you are going to make the business decision to implement it. It’s simple for them to implement so it would be irresponsible of them to not apply for the patent and be prepared if the courts rule it is allowed.

    3) If the ebooks rentals were priced as rentals there wouldn’t be a market for reselling them. When you price them equivalent to new hardcover pricing then there is. You make your bed so sleep in it. $20 ebooks aren’t rentals in the view of most consumers. Both Amazon and Apple appear to be listening to their customers instead of ignoring them.

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