Reselling MP3s: The music industry's new battleground?
A person could transfer numerous copies of the same song file as long as it was free of DRM. But Meshkin says his company can prevent repeat sales of the same song. Bopaboo has developed song-identification technology that prevents individuals from uploading more than one copy of the same song to the site regardless of how the file might be altered, Meshkin said. A copy is always produced when MP3s are transferred and that is retained on a computer's hard drive. Meshkin didn't have any technological solution for that. He said that in such harsh economic times the music industry must accept a few risks. After all it was they who allowed their music to be sold without DRM in the first place. "Obviously, MP3s are very easy to duplicate," Meshkin said. "It's very difficult to tell the difference between a so-called new copy and a so-called old copy." The label guys are unlikely to just shrug their shoulders at this kind of set up, said von Lohmann."If you buy a song from iTunes' (DRM-free) store you can immediately go and sell a copy of the song on Bopaboo," von Lohmann points out. "You would be assured of getting a discount on your iTunes purchase. There is no doubt that the first-sale law was drafted with physical objects in mind. There's no question that you are allowed to sell books or CDs. But when it comes to selling MP3s, it's an untested legal question." Another problem for Bopaboo, says von Lohmann is that some digital music stores specifically forbid the resale of songs. At Amazon.com for example, the terms of use agreement says customers must agree to "copy, store, transfer and burn" digital music for personal-use only. Customers also agree that they won't "redistribute, transmit, assign, sell, broadcast, rent, share, lend, modify, adapt, edit, sub-license or otherwise transfer" the music.I spoke with two label representatives who declined to comment for the record but told me they thought the resale of DRM-free songs could be the music industry's next big legal battleground. Patrick Ross, executive director of the Copyright Alliance, a watchdog group made up of artists, producers and other content creators, chuckled when I explained Bopaboo's business model. "Clearly a first-sale defense won't apply here," Ross said. "In the case of a book or any other creative work, you no longer possess the work once you sell it...It's also hard for me to imagine the model succeeding because if somebody wants to pay for works they will pay for it at a legal site and see that creators are compensated. If they are willing to break the rules, they would just go on (P2P service) Lime Wire and get it for free. I hope (Bopaboo) crashes and burns before it gets sued. It seems like a flawed business model as well as an illegal business model."If the business model isn't a hard enough pitch to make to the music industry, Meshkin has the added burden of trying to explain his past. In a February 2005 story, BusinessWeek questioned some of the claims Meshkin has made about his background and highlighted the controversy surrounding his oversight of a NASCAR racing team for Toyota at the age of 23. According to the story, Meshkin was sued by one former executive with Bang Racing, his NASCAR team, and accused by some investors of misleading them about his personal wealth and ability to operate a racing team. Meshkin is quoted in the magazine denying the accusations. Toyota eventually pulled its support.
