Series/Report no.:
ITS 33rd European Conference 2025: "Digital innovation and transformation in uncertain times", Edinburgh, UK, 29th June – 1st July 2025
Abstract:
The exhaustion principle, or first-sale doctrine, limits copyright holders' control after the authorised sale of a tangible copy, enabling resale, lending, and preservation. In digital markets, however, this principle has largely become irrelevant, as distribution models now rely on licences that prevent secondary use. This paper examines how the disappearance of copyright exhaustion affects four key digital markets – books, music, video, and software – along six dimensions: access, preservation, privacy, transactional clarity, user innovation, and platform competition. Drawing on a structured review of legal and economic literature, it assesses both the erosion of these benefits and possible remedies, including forward-and-delete technologies, common law exhaustion, relaxed anti-circumvention rules, and enhanced fair use provisions for libraries. The study argues that digital distribution has shifted the balance of rights too far towards copyright holders and that differentiated regulatory reforms may be needed to restore a socially beneficial equilibrium that preserves both market efficiency and user rights.