Apple patent points to used digital resale
Quick on Amazon’s heels, Apple has filed its own patent for selling or loaning used digital content, including ebooks, music, movies, and software applications. Mikey Campbell reported at Apple Insider that the patent, published Thursday by the U.S. Patent and Trademark office, “provides for the authorized access to digital content, otherwise known as digital rights, to be transferred from one user to another.” He noted that Apple’s patent differs from Amazon’s in that Amazon’s establishes a marketplace environment and Apple’s “decentralizes the process by taking the online store out of the equation.” Campbell quoted from the patent:
“Alternatively, instead of a third party determining whether one or more criteria are satisfied, the first (or second) user’s device makes the determination and may be responsible for preventing the first user’s device from further consuming the digital content item. In some embodiments, the online store and/or the publisher of the digital content item may receive a portion of the proceeds of the transfer.”
Campbell noted that Apple’s system allows publishers to set restrictions of transfers, such as preventing ebook transfers for a specified period of time after publication, limiting the number of times an ebook can be transferred, and setting minimum resale prices.
The patent also outlines a number of payment scenarios involving resale proceeds being divided between two or three parties, and even allows for the owner of the digital content to pay for the transfer — essentially buying the content again — in order to gift it, the proceeds of which still being split between designated parties. Over at PaidContent, Laura Hazard Owen highlighted the potential for publisher profit from Apple’s system. Quoting from the patent, Owen wrote:
“In one possible outcome, ‘the percentages that each party or entity receives from a resale of a digital content item changes (1) based on the passage of time or (2) based on how many times the digital content item has been resold among end-users. For example, publisher 110 receives (a) 50% on each resale of digital content item 202 that occurs within a year of the initial sale from intermediary 120 to Jeff and (b) 20% on each resale that occurs more than a year after the initial sale. As another example, publisher 110 receives 50% on the first resale (i.e., from Jeff to Sally) and 40% on second resale (i.e., from Sally to another user, not shown).'”
David Streitfeld covered the news over at the New York Times and noted that the current copyright infringement case of Capitol Records versus ReDigi making its way through the courts might make both Apple’s and Amazon’s patents mute. (ReDigi is a marketplace for reselling digital music.) “A victory for [ReDigi] would mean that consumers would not need either Apple’s or Amazon’s exchange to resell their digital items,” Streitfeld wrote. “Electronic bazaars would spring up instantly.”
Speculating on Barnes & Noble’s uncertain future
Following the news last week that Leonard Riggio, Barnes & Noble’s largest shareholder, presented an offer to buy the company (minus the Nook and college bookstore divisions), Andrew Bary speculated on the company’s potential fate in a post at Barron’s. Bary warned that the “big risk for shareholders is that Riggio tries to pull a Dell-like move and make a low-ball bid.” (Link added.)
Bary said B&N “should consider all alternatives,” including potential additional bidders. He suggested Microsoft, which invested in the Nook last year, could jump start its retail strategy by buying the entire company, and also suggested Liberty Media as a potential bidder.
Over at Forbes, Eric Savitz considered Bary’s post and noted that yes, buying B&N would instantly provide Microsoft with more storefronts than Apple, but “what they would have is, well, a whole lot of stores that sell books, as opposed to say tablets, PCs, mobile phones and Xbox consoles.” The math might work, he said, but “the logic of such a combination is elusive.”
The uncertain future doesn’t seem to be stopping B&N from moving forward. The company expanded its Nook Video service this week, announcing several new licensing partners. The press release listed the new licensing partners — including Lionsgate, MGM, Paramount Pictures, Relativity Media, National Geographic, Little Pim, and Film Buff — and noted new content the partnerships would bring, including movies such as The Hunger Games, the Twilight movies, and Skyfall, and TV shows such as Mad Men and Border Wars.
A Medium model to support journalism
Internet entrepreneur Ev Williams took to the stage with Jason Calacanis at the Launch Festival this week for a fireside chat. Rip Empson at TechCrunch pulled together a nice report on the chat and noted Williams’ intentions for his new Medium platform is to “create a platform that can give context to the content that people create, eventually leading to a system where the whole becomes more than the sum of its parts.” Empson also highlighted Williams’ broader journalistic intentions for Medium:
“While the economics of journalism ‘is a very tough problem,’ Williams says, building an economic model that supports journalism ‘is a worthy goal’ and something Medium is ‘definitely going to experiment with,’ he concluded. The economics are different building a content platform than it is for a publication, any time you build a content platform, you will have commercial usage, and if it’s sizable then there’s money to be made, which is different than the problem The New York Times faces, for example. The idea is to create a bunch of people who are motivated to create content not because they’re getting paid, but because they want to create.”
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