Is It Illegal To Give Stuff Away?
from the wait-a-second... dept
Kevin Heller has picked up on the fact that both Yahoo and GoDaddy seem to be selling domain registrations below cost, and wonders if this violates California’s unfair practices act (or similar acts in other states) which says: “It is unlawful for any person engaged in business within this State to sell any article or product at less than the cost thereof to such vendor or to give away any article or product, for the purpose of injuring competitors or destroying competition.” This is a typical “anti-dumping” law, that usually doesn’t get much attention unless some large incumbent feels threatened by an outsider. However, when you read that, it could be interpreted in a way that makes any company that advertises break the law. An advertisement is, by its very nature, giving something away at less than cost for the purpose of injuring competitors (that is, getting a sale instead of having that go to competitors). Apple and Pepsi are giving away free iTunes songs. That’s below cost, and clearly designed to take business away from other music download stores (and from other beverages). That seems to violate the law. What about in the software space? Does this outlaw any company that offers free software? Is MySQL violating the law by offering the database for free? What about Microsoft offering anti-spyware for free? Or does the law somehow only apply to tangible goods? Even in that case… when I bought my laptop, it came with a “free” printer. That’s obviously below cost and designed to take business away from the competition. While they’re not new, in an age where “free” is important, isn’t it about time these anti-dumping laws went away?