At issue is whether the music sold through these services is a “license” or a “sale.” Sony pays less to its artists for sales than for licensing (Sony artists reportedly earn $0.045 for each $0.99 song sold on iTunes). Naturally, Sony claims that the songs sold on iTunes are sales and not licensing deals.
This is where it gets interesting. As Brad Templeton and others have pointed out, Sony and others have long maintained that what you get when you buy an iTune is a license, not ownership of a product. That license prohibits you from doing all kinds of otherwise lawful things, like selling your music to a used-record store, loaning it to a friend, or playing it on someone else’s program.
But if Sony says that it’s selling products (and therefore only liable for 4.5 cents in royalties to its artists) and not licenses, then how can it bind us, its customers, to licensing terms?
The distinction between sale and license is VERY important. The trend has been towards licensing instead of selling, and the difference has not been a big part of the public dialogue.
I wrote about this a while ago, with respect to DRM, consumer usage rights, and how this pattern might affect other kinds of consumer transactions if they followed the same rules:
Tags: sale, license, boingboing, drm, cory doctorow, sony, itunes