Amazon got a lot of attention earlier this week with news broke that they had been awarded a patent for a "used digital content" marketplace. Many took it to be a sign that Amazon was interested in creating used content market similar to the one they maintain for books, DVDs, and other physical media.
Naturally this has the blogosphere and tech industry intrigued, but no one was more interested than ReDigi. This 2 year old startup has already launched a marketplace where US residents can resell music they bought. It went into a public beta in October 2011, but only currently supports music purchased via iTunes.
ReDigi is already running the marketplace that Amazon hopes to exploit, and today they took the effort to explain why they were different and better than Amazon.
There's one part of the press release that I find especially noteworthy:
ReDigi's advanced technology employs a "Verification Engine" and "Atomic Transaction", resulting in a TRANSFER ONLY mechanism. This means that all digital goods are first verified to ensure that they are legally eligible for resale. Once verified, ReDigi's technology transfers the "original" good from the user’s computer to ReDigi's Cloud (Marketplace). With ReDigi's method, only the "original" good is instantaneously /atomically transferred from seller to buyer without any copies. ReDigi then assists the seller with an anti-virus like software application that monitors the seller’s computer and synced devices to ensure that any personal-use copies of the sold good are removed.
Just to be clear, ReDigi want to install an app on your computer so they can make sure to delete any copies of a song you sell via their service.
I am not being melodramatic when I say that the thought of a program running in the background, messing with my computer, makes me very nervous. If the idea does not bother you then I have 2 words for you:
Back in 2005 Sony had a bright idea. They decided to bundle music CDs with software that secretly installed itself on any computer which tried to play the CD. Sony was trying to control what customers did with their legally purchased content, but they also harmed up those same customers via the security holes in the poorly written rootkit software and by reducing the performance of the customer's computer by running the software in the background.
Let's consider for a moment some of the ways that ReDigi's app could go wrong . A bug introduced in an update could delete unrelated files. It could introduce security holes in the firewall. And at the very least it will slow down my computer.
To be fair, 14 months have gone by since ReDigi launched the beta and I cannot find any horror stories about the app. But that could be because I have not had a chance to break the app yet (it's my scientific specialty).
Folks, I have enough trouble getting McAfee to play nice with the web browsers, apps, and security software I already have; I really don't want to introduce yet another possible security leak into the mix.
And that's a pity because I rather liked the concept behind ReDigi. I was hoping this company would have the funds to survive the lawsuit EMI filed against it last year. The possibility that they could follow through on their plans to resell ebooks has kept them on my radar.
Then again, ReDigi's business model (as well as Amazon's patent) is more than a little ridiculous. It tries to make scarce that which is infinite: digital content.
No, I'm not promoting piracy here; I'm discussing the basic nature of digital content. The real cost of shifting electrons around on my hard disk so they resemble a copy of a particular song is so close to zero as to be indistinguishable.
Creating a business model that pretends an infinite resource is a scarce one is nuts. I think it's better to acknowledge reality that the old business model doesn't work with new tech and instead start looking for a new business model.