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Sam Posten

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Alan, all I can tell you is this: The studios would like you to think that reselling of codes or breaking of bundles is illegal. It is not and they never claim that it is. It is a policy issue that they have no standing legally to push. Again, I encourage you to read up on First Sale Doctrine. They legally cannot stop the breaking of bundles which has been shown to be a consumer's _right_. That they have magically tied a license to a code does not change how the FSD works.

They continue to sell bundles because consumers like them and are willing to pay for the privilege for the most part. And some of those consumers have no intention of ever using codes and do not redeem them, and it is their legal right to resell them regardless of the studios druthers. Those consumers have not even signed up for a digital viewing account, so they CANNOT possibly be in violation of a TOS because they have not agreed to one. HTF supports those customers and our members who want to buy, sell and trade low volumes of these codes.

There are also those who set up arbitrage marketplaces to buy and sell these codes in bulk. Like from rental houses who rent out 20 copies of a bluray and sell off those codes for extra profit. HTF categorically does NOT support this. You can see the reasons why in the links in my signature block. We -could- support those too and make very convincing arguments for doing so, but this is where the HTF owners have drawn the line. I monitor the threads myself to make sure that we are not supporting those vendors. It's a fine line, some people have very good networks of friends and contacts for getting codes to trade and have a large library to trade/sell, but none of these people are doing so as a professional storefront as far as we can tell from their posts.

Again, the studios have the power to shut this tap off. They can do so by not bundling the codes. They can do so by setting a legal precedent that somehow there could be a legal issue here. That they have not is telling.
 

DaveF

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I don't have a dog in this fight regarding HTF's marketplace for digital movie codes. I don't care whether the forum has a software marketplace or not. I view it as a decision for the owners of the forum, as to whether it enhances the forum for their membership. So I'm trying not to let myself get drawn into arguing for the sake of arguing, which is too easy for me on a topic like this :)

But I want to propose that even if there is not a difference of kind between piracy of digital media and selling digital codes, there's a difference of degree.

"Piracy" as usually understood is one bit-perfect copy of a movie distributed to large numbers of people. In the logical conclusion, if piracy were legal, only a single copy of a movie would be bought and the remaining seven billion people on earth would all download bit-perfect copies for free.

But digital codes are a one-off transaction. Arthur buys a combo pack. He keeps the blu-ray and sells the digital code to Betty. Charlie is left out; he has to buy his own combo pack to get a movie. In the logical extreme, if digital codes are legal to sell, 3.5B copies are sold retail, and then the other 3.5B people on earth get inferior, but free, VUDU copies from their generous friends who already paid retail for the combo pack.

Piracy leads to the destruction of all artistic endeavor, in the extreme. Selling digital codes leads to lesser, but still lots of, profits in the extreme.

It's this pragmatic view that even if selling digital codes is somehow "wrong", I can't get worked up about it. Even if you view it as a form of piracy, I expect you'd agree that it's a completely different degree of piracy.
 

Carabimero

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I heard a compelling argument that downloading a movie from a bit torrent isn't theft because the IP owner doesn't actually lose anything. No physical object was stolen. The down loader wasn't going to buy the movie anyway, so no sale was lost. The market for the product was therefore not hurt. In fact, its market is often improved, the argument goes, since downloading a free product can lead to the sale of a better quality factory original that otherwise never would’ve been bought.

Being an obscure author, I know this is true because the best way for me to sell my books is to give some of them away for free. It never fails--if my writing is good.

I have a friend who buys discs, copies them, then sells the original on eBay to recoup his investment while retaining a perfect clone. Sometimes he even makes a profit. Piracy? His public actions are legal. Studios don't object. How is the end result any different than what occurs every day on this forum when someone, having bought a disc, then sells the digital copy to recoup their expense while retaining the original? At first blush it might seem worse to burn a bootleg: an encryption was broken and an illegal copy willfully made, yet one could argue selling a digital copy is worse because in the first case the resell buyer got a better quality original instead of an inferior UV copy.

Fair statements? Or rationalizations for allowing stealing?

Whatever one's views, I could rattle on comparing and rationalizing methods and degrees of intellectual property theft until I own many movies that I didn't pay for, all the while convincing myself I have done nothing illegal or unethical. Personally I don’t care if an individual breaks a license, sells their codes and ends up getting movies essentially without paying for them. It's none of my business.

My objection is when an organized public group facilitates the practice.
 
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DaveF

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Thanks Carabinero. For a little more meta commentary: I'm not here to change anyone's mind. That's unrealistic. Not because we're closed mind fools, but because we've come to our positions over the years, and they're formed from a mixture of logical and emotional and experiential motivations. A few comments on a message board can play a role in shifting attitudes, but usually isn't the specific pivot point.

But we can understand each other better. And for ownership, it might help inform their views of what's beneficial or detrimental to their forum's interests.
 

DaveF

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I heard a compelling argument that downloading a movie from a bit torrent isn't theft because the IP owner doesn't actually lose anything. No physical object was stolen. The down loader wasn't going to buy the movie anyway, so no sale was lost. The market for the product was therefore not hurt. In fact, its market is often improved, the argument goes, since downloading a free product can lead to the sale of a better quality factory original that otherwise never would’ve been bought.
I think this is mostly wrong. The "I wouldn't watch it otherwise" seems to be a self-evident lie since they obviously want to watch it and are willing to go to lengths to acquire it. In some cases this involves paying money for VPN services to protect their acquisition of free material. Were it not available, they'd consume less but pay for it some fashion. I'm skeptical that the folks downloading terabytes of free material would otherwise be out rescuing puppies or pumping iron if they had to pay for their blu-ray movies.

There is a little truth to the concept: the person with a cable subscription, but downloads a show from a private website to their phone to watch on an airplane.

I have a friend who buys discs, copies them, then sells the original on eBay to recoup his investment while retaining a perfect clone. Sometimes he even makes a profit. Piracy? His public actions are legal. Studios don't object. How is the end result any different than what occurs every day on this forum when someone, having bought a disc, then sells the digital copy to recoup their expense while retaining the original? At first blush it might seem worse to burn a bootleg: an encryption was broken and an illegal copy willfully made, yet one could argue selling a digital copy is worse because in the first case the resell buyer got a better quality original instead of an inferior UV copy.

Fair statements? Or rationalizations for allowing stealing?
Your friend is a pirate.

This is the first case I described. One person buys a single copy, then distributes it to everyone. This is the destruction of all art scenario, reductio ad absurdum.

Whatever one's views, I could rattle on comparing and rationalizing methods and degrees of intellectual property theft until I own many movies that I didn't pay for, all the while convincing myself I have done nothing illegal or unethical. Personally I don’t care if an individual breaks a license, sells their codes and ends up getting movies essentially without paying for them. It's none of my business.

My objection is when an organized public group facilitates the practice.
This gets my attention. Here perhaps is the meat of the matter, in our differing views.

We both agree that "piracy", as in the case of your friend, is wrong. A person buys a thing, makes an exact copy of that one thing, and then gives away (or even sells, which is worse!) that thing without also deleting their copy. En masse, this is not a good thing.

But where we differ perhaps is how much freight we give to "licenses".

What I see happening is a form of arbitrage. Someone bought a multi-pack. They keep part of the multi-pack, and sell other parts. First sale doctrine. There's no piracy, in that no copies were made while the original content was sold off. But, you argue, they broke the binding agreement made at purchase that the combo pack can't be broken up. It's that implicit agreement, that is unknown until the shrink-wrap is broken and the product opened and unreturnable, that I reject, and that violates the First Sale Doctrine, that I don't care about.

I tend to dislike analogies when discussing digital media issues, since they're usually a bad fit. Hopefully this is a good fit:

I bought this combo pack of five keychain flashlights. I need two (one for me and my wife). Is it wrong to re-sell the three I don't need? Is it wrong to give the three I don't need to my young nieces (what kid doesn't love a flashlight)? Suppose the combo pack came with a slip of paper stating that resale of individual units is prohibited? What if it said that the individual units are prohibited from redistribution to anyone beyond the original purchaser: is it morally wrong to give the extras to my nieces?

Is it wrong for HTF to allow me to try and engage in arbitrage and give or sell off the extra units I don't want from my flashlight combo pack?

All because the manufacturer's preferences?

I think this is a difference: I skew towards the purchasers' freedoms to do as they will with what they bought. You, I gather, skew towards the original sellers' control of how the material is packaged and sold and re-sold.

And from this: I see no issue with HTF having a secondary market for codes. (I'm concerned with the issues around moderating sales listings and transactions and whether this is beneficial to HTF. But not with a whiff of "wrongness" of the sales per se.) But, if I understand, you think it is inappropriate for HTF to support people in breaking the desires of the media distributors?
 
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Carabimero

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I also appreciate the open dialogue of an otherwise taboo subject. Thank you.

I think this is mostly wrong. The "I wouldn't watch it otherwise" seems to be a self-evident lie since they obviously want to watch it and are willing to go to lengths to acquire it.

To clarify, I didn't say they wouldn't otherwise "watch" it. I said they otherwise wouldn't "buy" it. This distinction is important because it is the entire meat of the argument.

This is the first case I described. One person buys a single copy, then distributes it to everyone. This is the destruction of all art scenario, reductio ad absurdum.

Again to clarify, I believe my analogy holds because my friend is not selling a bootleg copy, he is selling the original, and he is not doing it en masse. He resold what he bought. Period. Someone who buys an original and sells a code is breaking a license. My friend is not, at least not in an organized public forum. Certainly what he is doing in private is illegal, but the analogy holds because both involve breaking either a license (a legally binding contract) or a law. To claim one should be obeyed and one can be broken because it is a lesser thing is a self-serving rationalization. That's why the license is there, to prevent digital code owners from doing in essence the same thing my friend is doing. To suggest one is worse than the other might be true, but not in the fashion you suggest. Unlike my friend, one could argue that the people selling codes on this site, day in and day out, are operating en masse. Comparatively, the totality of code commerce on this site is massive.

But, you argue, they broke the binding agreement made at purchase that the combo pack can't be broken up. It's that implicit agreement, that is unknown until the shrink-wrap is broken and the product opened and unreturnable, that I reject, and that violates the First Sale Doctrine, that I don't care about.

I don't think it matters on an individual level. Individuals can make that choice individually. I'm not here to argue that. But this organized public forum is now aware (if they weren't before) that they are enabling the daily breaking of a massive number of individual license agreements, and with that knowledge, they are willfully continuing the practice.

That is the heart of my entire argument. Some say it's peanuts compared to "real" bootleggers. Others say "big deal" until a studio tells them to stop. These all appear to be self-serving rationalizations lacking a moral or ethical compass. Lead by example, not by strictly forbidding something ("No discussions about bootlegging! We mean it!"), then actually promoting it when it serves your interests (facilitating the reselling of codes). It's hypocritical. It diminishes respect and authority. It weakens the very fabric of this forum.

Is it wrong for HTF to allow me to try and engage in arbitrage and give or sell off the extra units I don't want from my flashlight combo pack?

All because the manufacturer's preferences?

I think this is a difference: I skew towards the purchasers' freedoms to do as they will with what they bought. You, I gather, skew towards the original sellers' control of how the material is packaged and sold and re-sold.

Privately, no. Publicly, yes. I don't care about the private sphere. I care about this public forum, a forum that I respect, a forum walking around with a big black eye they've had for so long that they don't seem to realize how it looks to others anymore.

Also, I don't think the flashlight analogy holds until we can replicate a proprietary flashlight at home. Let me instead make an analogy between the DMCA and an amendment to the Constitution. As Sam pointed out, nowhere in the DMCA does it specifically say codes can't be resold (that's what the license agreements are for). But I believe the legal framework is there to make it easier to successfully prosecute that activity than to defend it.

But, if I understand, you think it is inappropriate for HTF to support people in breaking the desires of the media distributors?

I don't know what the desire of media distributors is. If they want to reprint their code inserts to end license agreements, it wouldn't be hard. What I do know is the HTF is aware that they are facilitating a massive number of license violations among individuals and are willfully continuing to do so in a public forum. I also know, through private conversations with others, that a significant part of this membership, people who do much of the bread-and-butter posting around here, wish it would stop.
 
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Alf S

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Still crossing fingers that someone will create a code/add-on or something that works with browsers like FF etc to ignore threads. Better still, HTF creates an option like they have for ignore users.
 

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