reselling – Techdirt (original) (raw)

Genshin Impact Developer Goes With Extremely Fan-Friendly Fan-Art For Commercial Sale Policy

from the merch-for-all dept

The manner in which content producers generally, and video game publishers specifically, handle art and content created by their biggest fans varies wildly. There’s the Nintendo’s of the world, where strict control over all things IP is favored over allowing fans to do much of anything with its properties. Other gaming companies at least allow fans to do some things with their properties, such as making let’s play videos and that sort of thing. Still other gaming companies like Square have managed to let fans do some large and amazing projects with its IP.

And then there is Chinese gaming studio miHoYo, makers of the hit title Genshin Impact, where the studio doesn’t just allow fans to make their own art and merchandise… but also flatout tells them that they can go sell it, too.

On May 21, miHoYo released its Genshin Impact Overseas Fan-Made Merchandising Guide, which explicitly permits the commercial sale of fan-made items up to 200 units. There are only a few restrictions and artists do not have to contact the studio for small batches under the limit.

The legal environment for fan art is so strained that conventions like NekoCon have limited the sale of non-official merch. Entertainment companies like FUNimation have explicitly stated in the past that creators at artist alleys, which are exhibition spaces at fan conventions where independent artists can sell unofficial merchandise, are “infringing Funimation’s copyright rights.” And it’s generally understood among artists that properties owned by companies like Disney are completely off-limits.

With some rules in place over the quantities being sold, this means that when it comes to miHoYo properties, fans don’t get sued over making merch. They don’t get sued over selling that merch. Hell, fans don’t even have to ask for permission to sell the merch. Instead, it’s a refreshingly open policy.

And because of that, as should be a shock to absolutely nobody save all the game publishers that want to go the lawsuit and DMCA route, Genshin Impact has an insanely active and vibrant fan community that keeps the game’s name at the top of everyone’s mind.

The studio’s open policy has made it possible for Genshin Impact fans to make more varied products than the prints, keychains, and charms that are typically sold at artist alleys. At the time of writing, a quick search on Kickstarter shows unofficial earrings, sweaters, bookbags, plush toys, and berets. And fans were willing to put money towards their enthusiasm. At the time of writing, there were 28 Genshin Impact Kickstarters with at least $10,000 in funding.

There are also numerous independent artists who advertise their fan-made items on Twitter. Olivinearc sells Genshin Impact merchandise in her online store, and despite only opening twice a year, she receives a couple hundred orders each time she opens. She uses the revenue to fund the development of her visual novel game, and she cites the revenue from unofficial Genshin Impact products as the reason she was able to expand its soundtrack.

This sort of symbiotic relationship that passionate Genshin Impact fans have for the game could be had by lots of other gaming companies, were they to only give up a bit of control over their properties to their biggest fans. It seems miHoYo understands this, rather than taking umbrage or offense at some fan out there making some amount of money from its properties. By treating these passionate fans in a manner that’s real and human, the company instead reaps the reward of all that free advertising that merely solidifies the fandom it has worked to build.

The only real mystery here is why more game companies don’t follow this path.

Filed Under: fan art, genshin impact, reselling
Companies: mihoyo

Southwest's Bizarrely Antagonistic Lawsuit To Stop Consumers From Finding Better Deals

from the throwing-away-goodwill dept

This lawsuit is a couple months old, but I’m clearing out some older stories, and thought it was worth writing up still. Southwest Airlines is regularly ranked as a favorite of consumers. While it’s generally relatively low cost as airlines go, it has kept up a reputation of stellar customer service — contrary to the reputations of some other low cost airlines. However, earlier this year, Southwest not only decided to be particularly anti-consumer, but to go legal about it. The company decided to sue the site Skiplagged.

If you’ve never seen it, Skiplagged is a neat service — effectively finding secret cheaper fares by exposing some of the hidden (stupid) secrets of airline fares. I discovered it years ago, after writing about some sketchy airline pricing tricks involving multi-city travel. The secret that Skiplagged realized is that you can often find cheaper flights by booking a multi-leg trip, and not taking all the flights. As Skiplagged sums it up: “As an example, a traveler who wants to go to San Francisco from New York would book a flight that is ticketed for NYC -> San Fran -> Seattle and end their travel once they arrive in San Fran and skip the leg to Seattle.”

This can create some pretty massive details, and like those sketchy scam ads say “this one weird trick… that the airlines hate” except that it actually works. And now Southwest has decided to go to court over it.

Now, it’s important to note that unlike many other airlines, Southwest requires people to buy tickets via its own site, and refuses to have its fares offered on aggregation sites. It also has a long and somewhat unfortunate history of suing websites who try to improve on Southwest fares in some manner. A decade ago we wrote about Southwest going after sites that help flyers track their frequent flyer mileage, and a few years back, we wrote about a ridiculous lawsuit against a website that alerted Southwest flyers if they could change their ticket to a cheaper option after they booked a flight (since Southwest has a no-charge for changes policy). Unfortunately, after a court refused to dismiss that lawsuit under Texas’s anti-SLAPP law, leading the site to effectively agree to shut down permanently.

Here, Southwest is claiming a sort of double-whammy — saying that Skiplagged is getting data on Southwest flights via another company (who Southwest is already suing), Kiwi.com, and using those fares to find the skipped leg cheaper options (also referred to as “hidden city” tickets).

Southwest claims this violates basically all the laws: trademark violations, page scraping violations, unauthorized sales, unfair and deceptive practices and a few others as well.

On June 8, 2021, Southwest wrote a letter to Skiplagged from Texas, explaining that Skiplagged was violating the Southwest Terms & Conditions by scraping and/or using data scraped from Southwest.com, promoting ?hidden city? tickets, and using Southwest?s trademarked heart logo to advertise the sale of tickets on Southwest Airlines without its authorization.

Southwest explained that Southwest had ?the exclusive distribution rights to sell Southwest flights to the general public through the Southwest Website? and never authorized Skiplagged to display or sell its fares, display its trademark logos, publish its flight or fare data, or to use the Southwest Website for or in connection with offering any third-party product or service?or use Southwest?s trademarks in doing so.

Southwest further explained that Skiplagged was inducing Southwest customers to violate the Southwest Terms & Conditions and/or Contract of Carriage. Southwest included a complete copy of the Southwest Terms & Conditions, and the details of registered trademarks.

While they may have (unfortunately) a legal leg to stand on, all of this should be seen as crazy. It’s not trademark infringement, as it’s providing factual information about the flights themselves. They’re not selling counterfeit flights. The flights are real and they’re really provided by Southwest. Scraping of such public, factual information, should never be illegal. Southwest is putting that information out there, and it doesn’t get to control how it’s used. And the fact that Southwest doesn’t want people to get off a flight too early is Southwest’s problem. They set the prices that way and the fact that some people have figured out how to game that system shouldn’t be someone else’s problem. It’s only Southwest’s.

Basically all of this is Southwest enabling all of this to happen, but then suing because people who figured out how to actually use their systems, their prices, and their information in ways that Southwest doesn’t like. That should never be a violation of the law.

The whole thing seems to be an abuse of the legal process to try to stop people from taking advantage of Southwest’s data and flights in a way that Southwest does in fact offer, but in a manner in which Southwest would prefer they not be able to. That should never be illegal. If Southwest doesn’t want people doing those hidden city flights, then it should fix its pricing. Or suck it up. Not sue. And, as some are noting, this very lawsuit seems to highlight how Southwest’s “customer friendly” persona is bullshit. Look how far the company will go to block its “valued customers” from actually finding the cheapest possible flights that Southwest does in fact offer.

Filed Under: air travel, hidden city, plane fares, plane tickets, promotion, reselling, scraping
Companies: skiplagged, southwest

The Weird Psychology Of People Fighting Those Who Resell Their Products

from the why-do-this? dept

Every so often, we hear a story about actions taken by someone who is just so upset about someone else doing something that it seems to border on obsessive. For example, when we hear about copyright holders who spend all their time sending DMCA takedowns — while whining about how they’re unable to produce new content and aren’t making any money from sending all those takedowns. The obvious response is: maybe stop sending all those takedowns and focus on something that’s actually productive, like creating new works and building a fan base willing to support you.

Recently, the Planet Money podcast had an episode with a similar story but in a different realm — but it was just as stupid and wasteful. It was about this entrepreneurial couple who had created a cat toy product, which was becoming fairly successful through selling it on Amazon. And yet, they were completely freaked out by arbitrageurs. These weren’t pirates or counterfeiters. Rather, they discovered that people were posting their cat toy to eBay (for a lot more money), and if someone bought, they’d just order it from Amazon, and have it ship directly to the buyer. I’ve heard of people having this happen to them — where they’d order from one place and receive a shipment from Amazon instead (sometimes with the actual invoice price included…).

This is all perfectly legal. There’s no law against reselling products. It’s just arbitrage. But the couple, Fred and Natasha Ruckel, freaked out about this and spent a ton of time every day sending cease-and-desist letters to these eBay sellers.

First thing in the morning, check for arbitrageurs. Last thing at night, check for arbitrageurs, send out any cease and desists before or after. It was taking up an inordinate amount of time, and it was super stressful.

Ruckel does make a few valid points: the eBay arbitrageurs provide a less satisfying experience — their sales pages don’t look great and Ruckel wishes to have a better experience for the customers to boost brand loyalty. On top of that, the even more valid concern is that when people order via eBay for 60andreceiveaboxfromAmazonshowingthepricewas60 and receive a box from Amazon showing the price was 60andreceiveaboxfromAmazonshowingthepricewas40… they get pissed off. And often they return the product, and that leads to restocking fees that Ruckel has to pay — plus just general hassle. That part is a valid concern, but from all indications this was still making them money.

And if it was really taking up so much time to send out these cease and desist letters — and it was “super stressful” why not just drop it altogether? Why bother? Just focus on selling your products. Or, hell, just put your own product up on eBay. To be fair, while this is not mentioned in the podcast, in an article in Entrepreneur Magazine about this same story, it does note that he tried, briefly, to put the product up on eBay too, but whines that people still copied him:

This summer, Ruckel tried a new approach: He put his own product on eBay and titled it ?All other eBay sellers are fake.? A few weeks later, he stumbled upon an eBay listing with a familiar title. ?All other eBay sellers are fake,? it said. It wasn?t his, of course.

Someone had copied that, too.

But, uh, so what? Assuming that he posted them to eBay with the same price as his Amazon sales, then there shouldn’t be a problem. All the arbitrageurs should be driven out of business, since his would be priced lower than the arbitrageurs. So who cares if they claim to be the legit provider, when people would likely flock to the cheapest one anyway? Nothing in this story makes sense.

Especially this last part. Ruckel apparently got so frustrated with the “stress” of dealing with arbitrageurs, that he yanked his stuff off of Amazon entirely… and saw his sales drop drastically.

We pulled out of the whole Prime shipping thing in May. And at that point, we were over 60,000 a month in sales. And in a blink, 60,000 went down to 25,000.

Planet Money asks them if it was worth it — and they said that it was. Because “integrity.”

F RUCKEL: Integrity is important to us.

N RUCKEL: And the stress factor…

F RUCKEL: And the stress…

N RUCKEL: …Was completely removed.

F RUCKEL: So we removed all the stress.

Yeah, and you also removed more than half your business. Again, this reminds me of the person who claimed they were “wasting” half of their royalties sending DMCA takedown notices that weren’t effective. Why do that? Why kill your sales just because someone else figured out a way to resell your product better than you have?

There’s some weird psychology going on here. It reminds me of the classic economics class game, whereby two students (Student A and Student B) are selected by the professor, and Student A is given 10andtoldtosharesomeofitwithStudentB—butifStudentBrejectsStudentA’soffer,thennoonegetsanymoney.Undersuchconditions,evenifStudentAoffersStudentBjust10 and told to share some of it with Student B — but if Student B rejects Student A’s offer, then no one gets any money. Under such conditions, even if Student A offers Student B just 10andtoldtosharesomeofitwithStudentB—butifStudentBrejectsStudentA’soffer,thennoonegetsanymoney.Undersuchconditions,evenifStudentAoffersStudentBjust1 (keeping $9), Student B should take it. Both of them are better off than getting nothing. And yet, time and time again, Student B rejects offers that are seen as “too small.” Basically, they feel insulted, cheated or ripped off — even though that’s ridiculous. It’s a weird attempt to insert a “fairness standard” where it doesn’t make any sense, and where “punishing” Student A is more “valuable” to Student B than the small payout.

It feels like something similar must be happening here. People like the Ruckels would prefer to punish others, making their own product harder to find and more difficult to buy, than to allow anyone else to possibly benefit from it. I get that it happens, but it still confuses me to no end why anyone could possibly think it’s a good result.

Filed Under: arbitrage, arbitrageurs, e-commerce, online sales, reselling, strategy
Companies: amazon, ebay

Why Trader Joe's Suing Pirate Joe's May Be Bad News For Ownership

from the secondary-markets-are-important dept

If you live near a Trader Joe’s, you’re probably well aware of the cult-like following these stores have. Hell, I’ll admit that probably 50% of the stuff in our pantry comes from Trader Joe’s and I could probably drive to either of the two near my house (we’re almost exactly halfway between them) blindfolded. But now it looks like Trader Joe’s is being something of a trademark bully, suing the interestingly named “Pirate Joe’s” store in Vancouver, British Columbia. There are no Trader Joe’s stores in Canada, and entrepreneur Michael Hallatt realized that this was a market opportunity. He regularly drives across the border, fills up his panel truck with goodies from Trader Joe’s in the US, drives back across the border and sells it at a decent markup in his shop. He suggests he’s spent somewhere around $350,000 at Trader Joe’s over the past two years, making him one of their best customers (and possibly their best overall customer). And they sued him, claiming trademark infringement.

Now, some are reacting emotionally to this, like Laura Heller from Forbes, who comes down on the side of Trader Joe’s, but mainly because it’s an emotional reaction. For example, part of the reason why she supports Trader Joe’s is because of this:

And finally, there’s the problem of pirated goods in general. Luxury brands regularly police pirated goods and employ legal tactics to stem the tide of faux or illegally obtained goods. Comparing cookie butter to Louis Vuitton may seem silly, but it’s the company’s currency and carries value in the marketplace.

Except these aren’t pirated goods. They’re not counterfeits. They’re legally purchased and resold. And that’s legal. When you buy something, it means you own it, and you’re supposed to be able to resell it on the secondary market. That’s actually a rather important part of our economy.

Thankfully, it appears that many legal experts have been pointing out that Trader Joe’s has no case. The SF Gate article linked above quotes a trademark lawyer who doesn’t see much of a case for TJs:

“I don’t think Trader Joe’s really has a chance, suing here in the U.S.,” said lawyer Greg Owen, a trademark, copyright and unfair competition expert with Owen, Wickersham & Erickson, an intellectual property firm in San Francisco.

If Trader Joe’s had sued in Canada, or if Pirate Joe’s were operating in the United States, the claim might be more viable, said Owen, who reviewed the lawsuit and motion to dismiss. He added, however, that the first-sale doctrine, which Hallatt is fond of citing and which lets people resell what they’ve bought, is more nebulous when perishable items are involved.

“On the flip side, Trader Joe’s is certainly benefiting from Hallatt purchasing the products,” Owen said. “They’re making money off him.”

Similarly, lawyer William Peacock, writing over at Findlaw explains why TJs has little chance of succeeding based on both venue (suing in the US) and the fact that you can resell what you’ve purchased. But, Peacock, like Owen, wonders why TJs would ever go after such a good customer:

The case presents a number of interesting questions, but here is the most important one: what is Trader Joe’s problem? Hallatt buys their products at retail cost and sells them in a market that they haven’t yet entered. They benefit financially from the arrangement. And if they do expand across the border, their normal retail prices, which are lower than his re-retail prices, would drive him out of business in a Vancouver minute.

Finally, law professors Kal Raustiala and Chris Sprigman, over at Freakonomics, have pointed out not just how ridiculous this lawsuit is, but how it could have a real impact on personal freedoms in terms of private property and the right to resell what you’ve purchased:

If TJ’s has the right to stop PJ’s from reselling their products, then any trademark owner might assert a similar right. Ford could sue Carmax for reselling Fords. Prince (the sports gear company, not the musician) could sue Play It Again Sports for reselling Prince tennis racquets. And if this were true, a trademark law that is aimed at preventing consumer confusion will be preventing something else entirely – competition.

Frankly, it’s a ridiculous lawsuit on all sorts of levels, and one hopes that the court recognizes the legal arguments, rather than the half-baked emotional ones. Trademark law is supposed to be about preventing consumer confusion, but there isn’t any here. Pirate Joe’s (amusingly changed to Irate Joe’s after the lawsuit started) isn’t trying to fool or confuse anyone. They’re totally upfront about the situation. There’s a demand in the Vancouver market, and Trader Joe’s isn’t serving it. So, Hallatt’s got a truck and he’s willing to use it to help both Trader Joe’s sell more, and the people of Vancouver get Trader Joe’s goods. Where’s the problem?

Some have argued about the potential “health and safety” aspect, but it sounds like Hallatt mostly avoids perishables or heavily regulated products like alcohol (sorry, no Two Buck Chuck). And, as Raustiala and Sprigman note, local regulators can handle any health and safety regulations. Trader Joe’s, in its filings, really tries to bend over backwards to claim some sort of sales “harm.” It argues that people from Canada travel down to stores in the US to buy their products, but that’s meaningless since Hallatt is doing the same thing, and opening them up to a wider market by including those who aren’t willing to make the trip. TJ’s response is that other shoppers who travel across the border are likely to buy more at TJs because (1) they have more selection and (2) they traveled across the border, so of course they’ll buy more. No joke:

Furthermore, it is reasonable to infer that a Canadian customer making the trip to the United States is likely to make a bigger purchase of goods to make the trip worthwhile.

Under that argument, TJ’s should make sure to put all of its stores as far away from where people live as possible. After all, don’t they want the few people who make the trip to buy more to make it “worthwhile.” Sometimes the arguments that lawyers come up with baffle me.

TJs also argues that if people have a bad experience with the food from Pirate Joe’s they may blame Trader Joe’s, but that seems unlikely and highly speculative on multiple levels. The products are still the same, they’re just being sold on the other side of the border.

Anyway, you can read some of the back and forth in the legal filings we’ve pasted below. The biggest legal issue they’re fighting over right now is the jurisdiction issue which (as mentioned above) also seems to favor Pirate Joe’s pretty strongly. Suing in the US makes almost no sense, and the hoops that TJs has to jump through to make it work seem like a huge stretch. But, in the end, as everyone else is asking, this seems like a really dumb lawsuit on multiple levels, and if it somehow comes out in TJ’s favor, in the long run, everyone loses out.

Filed Under: canada, first sale, michael hallatt, ownership, private property, property rights, reselling, trademark, us
Companies: pirate joe's, trader joe's

Ticketmaster Trying To Cut Down On Scalpers… Or Increase Fee Collection For Itself?

from the some-good,-some-bad dept

Earlier this year, we had covered the news that Ticketmaster was pushing paperless tickets as a way to cut down on scalping, and now that story seems to be getting much wider coverage. The idea is that if you buy a ticket, you have to be the one to show up, with an ID and the credit card you used, in order to attend. Ticketmaster will allow you to transfer… but it can limit the price of a transfer and charge you a fee for the transfer. That makes it seem like this is a lot more about collecting more fees from the secondary market, than really cutting down on scalping. Not to mention that it seems likely to cause problems. How do you handle buying tickets for someone else as a gift? Under this system, you’d need to buy… and then “transfer” at a fee. And what if you really can’t go, but the ticket has already been transferred once (a limit they set on the system). Finally, does it really make sense to block out basic market mechanisms? I recognize that there’s an issue of scalpers buying up huge blocks of tickets, but there are better mechanisms to deal with that, that don’t involve limiting what legitimate purchasers can do with their tickets.

Filed Under: e-tickets, reselling, ticket scalping, tickets
Companies: ticketmaster

If Downloading A Song Is Just Like Stealing A CD, Why Won't The RIAA Allow Reselling MP3s?

from the either-it-is-or-it-isn't dept

When you hear RIAA defenders insist that an unauthorized download is “just like stealing a CD” or something along those lines, it’s worth noting even they don’t really mean it. After all, if a digital file really was no different than a physical goods purchase, then you’d be able to do other things with it — such as resell it. And yet, as you read through Eliot Van Buskirk’s article about new online services trying to create marketplaces for people to sell their “used” MP3s, you’ll see the scenario is quite different. After all, it’s perfectly legal to sell your used CDs, but now when it comes to selling used MP3s you need a record label’s permission? Why? Well, because even the record labels seem to inherently know that a CD is quite different from a download. So when the RIAA claims they’re the same, what they really mean is “only the stuff we like is the same.”

Filed Under: copyright, mp3s, reselling
Companies: riaa

Schumer Tries To Force Scalpers To Register; Limit How They Buy And Sell Tickets

from the is-this-needed? dept

There’s been plenty of complaining about how ticket scalpers for various concerts and sporting events have been scooping up all of the tickets for events and making it more expensive for fans to get those tickets. Of course, in many cases, companies like TicketMaster and the musicians themselves are in on the deal, pretending to offer “scalped” tickets that they’re really selling themselves. With so much talk about this issue, you knew it was only a matter of time until some grandstanding politician got involved. In this case, it’s New York’s Chuck Schumer, who has introduced new legislation to try to limit ticket reselling (thanks to Eric Goldman for sending this over). It will require ticket resellers to “register” with the FTC, and then such official resellers will only be allowed to get tickets two days after the tickets go on sale.

It’s difficult to see what good this does, other than create a bigger bureaucratic mess. If you don’t think that the ticket resellers will figure out workarounds, you haven’t been paying much attention over the past few years. Besides, the very fact that Ticketmaster thinks this is a good law is a pretty damning sign that it’s not doing much to solve the problem, but is really designed to help Ticketmaster make more money.

It’s still difficult to see why these issues can’t be solved effectively without legislation. Bands can offer early tickets through fan clubs or mailing lists, or use other tools to make sure fans get tickets at lower prices. Besides, if the demand really is that high for certain tickets, what’s wrong with letting the market determine that?

Filed Under: bureaucracy, chuck shumer, registering, reselling, scalping, tickets
Companies: ticketmaster

No You Can't Sign Up For A Comcast Account And Resell It Throughout Your Building

from the or-do-it-35-times dept

While some progressive ISPs such as Speakeasy have allowed customers to “resell” their connections via WiFi, most broadband providers frown on the practice. They don’t seem to mind the casual sharing between neighbors, but it’s not too surprising to see Comcast sue a guy who tried to set up an entire wireless ISP business this way. It’s almost creative… he subscribed to Comcast broadband at 35 different condos, and then advertised his own “connectivity” within each of those buildings. It’s hard to believe his defense will work:

He said Comcast signals are often used to power wireless networks at places like Internet cafes and other businesses that charge users for access. “This is a practice that happens throughout any city,” Clark said. “Unfortunately, we’re one of the bigger guys in town – so, here we are.”

I think he’ll find that most businesses reselling access aren’t using residential Comcast connections — and even if they are, they’re offering very short, temporary connections, rather than permanent service. While I actually think plans like the Speakeasy plan we discussed that allow subscribers to resell their connections is smart, that doesn’t mean that this guy is going to get away with this “business.”

Filed Under: reselling, wireless
Companies: comcast

Vancouver Olympics Using Copyright Law (Rather Than Scalping Laws) To Ban Ticket Reselling

from the misuse-of-copyright dept

Michael_S points us to the news that the Vancouver Olympics — no stranger to massive abuse of intellectual property law — is now using copyright law to prevent ticket resales. Now, lots of places around the world have anti-scalping laws that forbid reselling of event tickets (or reselling them above a certain price). Vancouver, however, does not have any such law. No problem for the Olympics folks… they’re using the special copyright they were granted on a whole host of common terms, including “Vancouver 2010” to sue resellers offering the tickets. Obviously, that’s got nothing to do with the purpose of copyright law, but when you grant silly monopolies, don’t be surprised when they’re abused.

Filed Under: copyright, olympics, reselling, scalping, tickets, vancouver