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IPodMeister: Trade your CDs for an iPod or iPhone… legally?

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CNet's Cheapskate Blog is one of my favorite sites for technology deals and very much a daily read. They recently had this article on iPodMeister. They provide you with the labels for free shipping. You simply pack up your old CDs and get a new iPod, iPhone, or hard drive. They'll even send you a DVD with all your music back for an additional cost (more CDs).

It sounds interesting, but I have a few questions and so did commenters:

  • Legality of Keeping Your old - The biggest thought in my mind is that once you sell your CD back to iPodMeister, it's probably illegal for you to keep a copy for yourself or use their digitizing service (I use "probably" because I'm not a lawyer.) If you it were legal to keep copies for yourselves, we'd just recycle CDs on Craigslist all day. I'd pay $2 to get the used the CD and sell it back to someone else for what I paid after I copied it. The Right of First Sale was getting a lot of scrutiny in some states as far back two and a half years ago.
  • Value for Your CD Collection - One commenter pointed out that you are getting less than a dollar a CD (or less) in value when a pawn shop would give you $1-2. I'm not up on the pawn shop market for CDs so I can't verify that.
  • Is iPodMeister affiliated with Apple? - Lastly (and least importantly), does iPodMeister have an affiliation with Apple? I ask only because they give out Apple products and use a derivative of the trademarked Apple iPod name in their name. Again, I'm no lawyer, just curious about these kinds of things.

The legality of the digitizing question is the big one for me. It just doesn't seem right. Yet it seems that the Consumerist will interview them and not ask the question. Interestingly though the Consumerist asks for feedback from it's readers on the service (largely implying that they don't know if it's a great deal either).

I have a pile of CDs back from my college days (Those BMG and Columbia House "deals" really got to me.) Though I've digitized all my CDs, I save space by putting them in binders and keeping the artwork and jewel case in the attic - of my old home in Boston. Because the service requires the artwork and cases, I couldn't use it even if I thought it was legal. Oh well, I think I'd rather have proof of the official rights to the music anyway.

Posted on November 18, 2009.

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12 Responses to “IPodMeister: Trade your CDs for an iPod or iPhone… legally?”

  1. Jim says:

    I can’t see how it would be legal to get back a digital copy of the CDs after you’ve sold them.

  2. Wayne says:

    Will comment only their service and will say that they are reliable and valid. I recommend them. I have used them twice on separate occasions. One for a nano and one for an iphone. I had digitized all of the cds and I just wanted to get rid of them without much work. I did not want to go through hassle of used store to sell. Done it before and half of time, they did not take them. Going through them was the easiest.

  3. What’s the legal question? Clearly it’s not legal.

  4. Lazy Man says:

    So why are reputable companies supporting this company clearly running illegal shenanigans?

  5. That’s a great question :)

    If they didn’t provide the service of ripping copies for you, it seems that they’d be on better legal ground, since they wouldn’t “know” that you’re keeping a copy. The risk/reward for that aspect seems to be considerably negative.

    What’s that I hear in the distance? The pitter patter of the feet of a cadre of RIAA lawyers?

  6. James W says:

    sounds like an interesting idea.

    also sounds a bit dubious to me re the legality side of things.

  7. Sara says:

    I really dont see though how they can have been doing business since 2004 (as their website claims) and not gotten shut down yet if they were running some illegal flimflam. I think right now the whole fair use thing is a grey area and until they come out with a definate legal/illegal stance this is a viable business.

  8. Dimetrius says:

    My name is Dimetrius. I was a member of the iPodMeister-team some years ago. Congratulations to the earnest and principled, debate about the legal aspects of the iPodMeister exchange of used CDs for a new iPod. Instead of taking one side I just want to provide some inside perspective from somebody who actually worked on the iPodMeister team.
    The digitizing is just a side-aspect of the iPodMeister story. For many years iPodMeister didn’t offer digitizing. There was no digitizing! Most customers don’t opt for digitizing. The only people that wanted their CDs digitized were usually classic- or jazz aficionados, often because they had out-of-print titles.
    Let me give you a little bit of background: iPodMeister is not a huge corporate entity but a small and always changing group of foreign college- and graduate students. The idea is to take old CDs that are collecting dust in the basements and attics of this country and to make them accessible in other parts of the world where people are still listening to CDs because they don’t have the money for an iPod. The team members of iPodMeister are all from different countries and go back there once or twice a year. The idea was to take CDs that nobody is listening to in the United States anymore and to find for them a new home among the people of less fortunate regions in the world (Colombia, Ecuador, Peru, Eastern Europe, when I was there although my guess is that they now deal a lot with South Korea, Taiwan, and Switzerland where sales of jazz and classical are exceptionally strong AND GROWING).
    I don’t want to distract from your principled, spirited legal discourse. But I just want you to refocus: digitizing is a side-aspect of the iPodMeister exchange of used CDs for new iPods. The real story is a recycling story and the transport of used CDs that bring pennies in the United States to countries where people still listen to CDs.
    When I was at iPodMeister we occasionally got people who wanted to “trade” or “swap” digital files. We always declined. We also deleted all files that were digitized immediately after sending them to the customer. If somebody wants to get his hands on a digital version of a current Top-40 hit there are much easier ways to do that then to buy the album, then send it to iPodMeister as part of a collection, and waiting to get it back on DVD. Almost all of the CDs I digitized were five to fifteen years old, in dusty and cracked cases, and often from labels that had gone out of business or CDs that were out-of-print.
    My recommendation: if you have even the SLIGHTEST legal doubts you should not opt for digitizing when doing the iPodMeister deal. Then you will get exactly what 95% of iPodMeister customers are happy with.

  9. Lazy Man says:

    Dimetrius,

    I see what you are saying. I think Ipodmeister’s core business is a good one. I just don’t want to see the good 95% shut down by the RIAA due to the bad 5%.

    As Wayne pointed out he just digitized them himself before using the service. I bet a lot of other people do, which is why 95% of Ipodmeister’s don’t pay (via more CDs) for the service.

    The defense you are using here is to basically say that they are only breaking the law 5% percent of the time. There isn’t a court of law in the US that will be okay with that defense.

    Ipodmeister should do the smart thing and end their digitizing service immediately. They’ll only lose 5% of their business (as you point out) and they won’t get a huge smackdown from the RIAA. Each song violation is a huge fine – so just offering one box of digitizing service to one customer is probably enough to put Ipodmeister out of business.

  10. Jim says:

    If ipodmeister hasn’t been doing digitizing for that long then that might explain why they are still doing it and haven’t been sued to death the the record labels. If they’re really a small group of college kids then maybe they just haven’t been big enough and gotten enough attention.

    Sara, just cause they’ve been doing it up to 5 years doesn’t make it legal. It just means they haven’t been noticed or sued yet.

  11. mx123 says:

    I am the owner MX123.com, a competing business that buys used Cd’s, DVDs and video games from the public. In 2008 we considered adopting this idea before we ever heard of Ipodmeister. We thoroughly looked into creating digital backups as a new value stream for our customers and we wisely choose to stay away from this. Ipodmeister has been operating in this manner for several years and it’s just a matter of time before the RIAA puts their sites on them. And i won’t feel the least bit sorry for them.

    They might be safe for a while. For one the RIAA’s main concerns appear to be online file sharing, bootlegging and downloading. Throughout, their overriding target has been distribution of “multiple copies” of a song or CD. For two, they are doing a good job insulating themselves by basing their operation in Switzerland and just having an operations office in New York. I wonder do they think paying people in Ipods instead of cash also insulates their legal exposure? Personally i would prefer an Android phone.

  12. Lazy Man says:

    Thanks mx123… I think it’s just a case of the RIAA getting to them as well.

    I hear you about the Android phone, but urge you to give Palm’s webOS a try. I love it.

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