History of videos, and first sale doctrine (a

Josh Greenberg provides an interesting brief history of video store circulation.

So here’s one interesting thing about that story to me.

“since a VCR owner could watch a purchased movie countless times, individual cassettes were priced at dozens of times the going rate for a box-office ticket.”

Then, as Greenberg recounts, the rental business model took over anyway Or perhaps because of the high-priced retail costs, instead of  ‘anyway’. At any rate, the copyright holders never succeeded in getting much of a market for those high priced retail purchasers, and a rental market developed instead, with the rental stores paying the high prices and then recouping through renting.

As a result of the rental model, the price for actually BUYING a movie dropped substantially, videotapes (and now DVDs) are NOT any longer sold to consumers at dozens of times the price of a box-office ticket, but at maybe 2-4 times, typically.  Presumably because once the rental model took over, it was clear that those higher prices were unrealistic for consumer purchase (really, they always were).

Now one thing I’ve never understood the legal basis of.  Video rental stores (and netflix too?)  still pay a MUCH higher price for copies than the consumer price, closer to that dozens-of-times-the-price.

While this might seem “fair”, since many people are going to watch that copy — I don’t know how (or if?) the publishers are able to _require_ rental stores to do this.  I thought the “first sale doctrine” applied to videos, and I thought the first sale doctrine said once you buy something, you are allowed to rent it out without a license.  (Printing additional copies yourself  like Greenberg says Netflix does still requires a license, which the copyright holders can charge what they want for).

One reason this is interesting to libraries is that the first sale doctrine is exactly what lets us libraries buy one copy of a book and then loan it out without a license to do that. (While some libraries pay special higher “library prices” for books, it’s never been clear to me if this is legally enforceable either; the first sale doctrine should protect our ability to buy a standard consumer copy and lend it out).

Now the first sale doctrine does NOT apply to software, typically.  Which is one reason why libraries are having so much trouble figuring out how to provide e-books to patrons at any kind of reasonable cost. But I know it applies to books, and I thought it applies to videos, which is why I’m confused about why libraries are willing to pay special higher “library prices” for certain books, and why video rental stores are willing to pay much higher rental store prices for purchase of videos.

The wikipedia page suggests that indeed the first sale doctrine applies to videos:

No special new copyright protection was given to movies on video and DVD by the two above amendments, and consequently buyers of retail DVDs in the United States are free to sell or exchange them, and rent and lend them to others.

The wikipedia page also confirms that it does NOT apply, or at least not without confusing restrictions, to “phonorecords” (and audio recordings in general I think), or computer software.  This is mostly because of specific congressional legislation that exempted these categories of things from the first sale doctrine . But not videos. So, still confused.

Very interstingly, the wikipedia article suggests that libraries are exempted from that exemption, and still have first sale doctrine rights for audio and software. So, wait, maybe libraries could legally buy an e-book (or any other software) and lend it out?   Assuming DRM doesn’t get in the way, because violating DRM is illegal in a different way. Phew, these things are confusing, clearly you need a lawyer (which I am not).

I wonder if any libraries are actually having legal counsel investigate this from an aggressive posture.  Probably not, most libraries don’t like to take aggressive legal postures, preferring to just believe whatever a vendor tells them. (Like, that they legally have to pay a high “library price” for a copy?)

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2 Responses to History of videos, and first sale doctrine (a

  1. Dorothea says:

    One reason that libraries may pay extra for a video is to secure public performance rights, which do not come along with first-sale.

  2. jrochkind says:

    Good point Dorothea. I was actually thinking more of special prices for library subscriptions to serials, which I know exist, and I don’t know why libraries pay them. And monographs,sometimes, although I’ve seen monographs more with “library bindings”, which doesn’t imply the library is required to buy that. But serials are often advertised with different prices for libraries for the same thing.

    I don’t know much about acquisitions in general though, not my area.

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