The Menlo Park startup Peerflix has been getting some ink the past couple days. They’re like NetFlix, only instead of renting a DVD for an indefinite time you trade DVDs with other members. Peerflix has no inventory, they provide the matchmaking service, mailing labels and points system that works like barter cash, all for a 99-cent per trade fee. You own the DVD you trade for, free and clear — and legal.
It’s models like this that bring home for me again why it was so important for the music distribution cartel to crush MP3.com’s Beam-It service and, more directly, why they’re sure to fight any possible emergence of a used digital-music market.
The Berkeman Center’s white paper on iTunes has a good discussion of the Digital First Sale doctrine (starting around page 51), and concludes people probably don’t have the right to resell used digital media (just the bits) like they do tangible things like books or CDs. But imagine for a moment that we did, and that things like the DMCA, draconian EULAs, and the RIAA shock troops didn’t get in the way. Now imagine a frictionless Peerflix, (or better yet a Peertunes) and that it’s hooked into your music player, so when you click on a song it automatically sells the song to you (locking anyone else out from playing it), plays it, and three minutes later it gets sold back to the digital lending library again. A whole town could share a single music collection; the less-popular music could be shared by a whole country. And it’d all be legal.
I can already hear all the usual clamoring from the cartel about how this sort of thing would bring down the music industry, destroy artist incentives, yadda yadda. The funny thing is, I don’t think it would — those are the exact same things that copyright owners whined about when faced with the creation of the library, used bookstores and the VCR.