Why You Don’t Really Own Your Ebooks

As a consumer, do you own that ebook for which you just paid and which you can now access via your Kindle, Nook, iPad, or personal computer? Amazon, Barnes & Noble, Apple and other ebook vendors say you do not. To understand why you do not own your ebook, we turn to a copyright law concept called the First Sale Doctrine.

What’s the First Sale Doctrine?

The First Sale Doctrine is why we can have a market for used books, CDs, and dvds. If you are the owner of a lawfully-made, lawfully-obtained copy of a copyrighted work, the First Sale Doctrine allows you to sell, lend, or otherwise transfer that copy in any way you wish.

However, the benefits of the First Sale Doctrine apply only if you own the copy. Manufacturers often try to defeat the First Sale Doctrine by distributing their products under a license agreement. All the major ebook vendors have used this licensing approach. As a licensee rather than a purchaser, you may not freely re-sell or loan out your new ebook.

Courts sometimes strike down manufacturers’ licensing characterization. This happened in the music industry when a court decided that promotional CDs distributed by record company UMG qualified as a sale or gift and not as a license, and could therefore be legally re-sold on eBay.

Do You Merely License that Ebook?

If ebooks-as-licenses were ever challenged, there is a good chance that a court would side with the ebook vendors. When looking at this same issue in other industries, the courts have ruled in favor of a license rather than a sale when the vendor tells the consumer it’s only a license, restricts the consumer’s ability to transfer the product, and imposes restrictions on how the consumer may use the product. Ebook vendors do all three.

Even if the First Sale Doctrine did apply to ebooks, there are currently technical barriers to exercising it since many ebooks are locked into or tethered to the reader’s personal reading device. Vendors would need to establish a technical means by which consumers could transfer their ebooks.

Comments

[Joy Butler]

Walt, Thanks for stopping by my blog. Including DRM would likely make it easier for an ebook publisher to argue that the First Sale Doctrine does not apply.

[Walt Shiel]

Joy,

Thank you for this post. As an author and publisher, this is something I've saying for years now. And it is why I have suggested on my own blog that eBooks should be priced much less than the print versions; after all, there is minimal intrinsic value in an eBook.

Does the absence of DRM play into this evaluation? Wherever possible, our eBooks are sold without DRM, which means a savvy customer can easily transfer the files to another device. Does this mitigate the license limitations?

Thanks,
Walt