Last month, Cambridge-based start-up ReDigi launched a marketplace for used MP3s, but even if the record companies let them survive, it will never be the new used CD store for cash-strapped college students. The site is sort of like a cross between eBay and Napster. If you're cleaning out your digital closet, you can upload your (legally acquired) MP3s to ReDigi and wait for a buyer. The proposition is a little bit misleading, though. The site boldly promises that you can "MAKE MONEY today!" but ReDigi doesn't actually offer cash for tracks. For each song you upload, ReDigi awards you with a 20¢ coupon for buying new music on ReDigi. If someone buys your song for the standard price of 79¢, you earn an additional 12¢ in ReDigi credit. You can use ReDigi credit to buy other people's used music on ReDigi, but it will not buy ramen noodles.
Even though ReDigi is not technically paying people cash for selling used music files, record companies still want to shut it down. The New York Times reports that the company received a cease-and-desist letter last week from Recording Industry Association of America, accusing ReDigi of violating copyright law by offering 30-second previews of songs for which they don't own a license. The RIAA's concerns make sense if you think like a pirate — why not just make a thousand copies of a single music library and sell them all? Well, ReDigi has obviously thought about this. First, ReDigi insists that they've built technology to keep pirates at bay. The Times explains:
When a user wants to upload a song for sale, ReDigi analyzes its metadata — a kind of digital fingerprint — to verify that it came from an official store like iTunes or Amazon. (It does not accept files ripped from a CD, or others whose provenance it considers suspect.)
A desktop program then deletes any copies left on a user’s computer, and can detect if that user tries to add copies later.
Second, ReDigi is kind of a cash trap. For now, you can spend money to buy songs on ReDigi, but you can only earn ReDigi credits for selling. So if you're a pirate and can already illegally acquire as much music as you want, ReDigi would be a waste of time. Until there's another economy for buying and selling ReDigi credits for cash, broke music fans who want to make a buck are out of luck.