Such companies are often forced to take risky and creative steps. One such step was made by “Half Price Digital” founded by Michael McNeff.
Background
In 2012, European Court of Justice handed down a decision in UsedSoft GmbH vs. Oracle international Corp (c-128/11), ruling that if you pay for a digital copy of a software and are granted perpetual license on that software, the right owner will lose his exclusive rights for distribution of that software.
That means, if you buy a software license you are allowed to resell it, and that applies not only on software bought on CD’s, it applies to digital copies received via internet too.
Opportunities
In the ruling of Court Michael McNeff saw an opportunity to create a platform where people could exchange and resell their software, including Apps for smartphones – that is how the idea of “Half Price Digital” came up.
While registering business in United Kingdom was not a problem for US citizen, transferring there money founded out to be quite of a problem.
To transfer large sum of money via PayPal McNeff had to have a bank account in UK, but due to tough US tax reporting regulations European banks are cautious to service United States citizens. They asked McNeff to come to UK just to open an account, which obviously was not the best option…
Michael used bitcoin instead; and he also integrated it into his project. Now you can pay for products on Half Price Digital using bitcoins. He assumed that bitcoin would draw attention to his project of users who are into modern information technologies.
Using bitcoin in his project also helps McNeff to avoid any pressure from PayPal such as a threat to freeze his account and thus not allowing them to influence any legal implications of Half Price Digital.
Michael believes that in the future many US businesspersons will form their businesses in the Europe to avoid any problems with patent assertion entities. As McNeff call them “patent trolls”, are large problem in States and being beyond their reach is an advantage.
At the moment, buying and downloading digital good via internet don’t allow you to resell them later. Such problem especially noticeable if you use some kind of distribution clients like Steam. Of course, some companies are adopting their policies allowing you to get refunds after returning a digital copy of software. Yet, such adaptation often have limitations; like returning a product in 24h after first launch, or such services are not accessible in all countries.
In future, such problems could be solved, as right now there is a lawsuit against Valve prohibiting to resell software bought through steam. Nevertheless, right now Bitcoin is helping such businesses like Half Price Digital to be afloat.