EMI fights start-up for recycling digital music

digital music is being sued by EMI, Smarthouse reports.

Boston-founded ReDigi aims to host a virtual store that would see the resale of pre-owned tracks. Essentially, the start-up restores a sense of individual ownership and value to the intangible digital product, as if it was reselling a CD album.

But, according to Herald Sun, a legal battle currently under way could have far-reaching implications.

At stake is not only the survival of a months-old start-up that wants to build an online market for "used" or, its preferred term, "pre-owned" digital music. If it comes to a decision, the case could also potentially unlock a vast resale market for billions of other downloaded files and, according to some legal experts, reshape the nature of ownership in the digital age.

"Potentially, this court could decide if consumers have any rights at all over their digital music, books or movies," said law professor from the University of California Berkeley School of Law, Jason Schultz. "It could completely redefine the contours of the digital marketplace."

According to the Music Business Journal, ReDigi works as a used digital record store. The prospective user has to open an account using his or her Facebook username in order to download the Beta ReDigi application and accept its terms of use. Once downloaded, the application scans the computer's hard-drive looking for “eligible” MP3 files. What ReDigi defines as eligible is music that has been legally acquired. During the scanning process, the ReDigi Media Manager uses a forensic verification engine that identifies which songs are available for the user to resell.

Selling a song from a user library means that, once sold, it will no longer be available for access. ReDigi erases the track from the computer and all sync devices when the “Send to ReDigi” button is pressed. Once uploaded, the song is offered in ReDigi's market for 59 US cents, and the user gets 10c when a sale is completed.

However, EMI and its parent company Capitol Records have likened ReDigi's operations to the online sharing company Napster, Smarthouse adds. "While ReDigi touts its service as the equivalent of a used record store, ReDigi is actually a clearinghouse for copyright infringement and a business model built on widespread, unauthorised copying of sound recordings."

The suit is scheduled for trial on 17 August.