If Your Business Model Requires An Overly Restrictive Contracts… You Have No Real Business Model

from the that's-not-satisfying-customers dept

We’ve discussed in the past how consumers are gaining more power over companies these days (and how that’s a good thing), and that leads to a separate, but also interesting observation: if your business model relies on denying customers what they want — such as through the use of overly restrictive contracts — your business model is in trouble. Thomas O’Toole has a good discussion about some recent lawsuits involving overly restrictive contracts that try (and usually fail) to prevent customers from doing what they really want to do. First, it discusses the recent attempt by MediaFire to stop the distribution of a Firefox extension that routes around MediaFire’s ad-driven business model. Second, it discusses a legal fight between Virgin Mobile and MetroPCS over whether or not MetroPCS can legally reprogram Virgin Mobile phones to work on its network.

The thing that shines through in both instances, however, is that they involved companies who didn’t rely on providing the best product for consumers, enabling them to do what they wanted — but instead, relied on contracts with overly restrictive terms designed to prevent customers from doing what they want. As far as I’m concerned, in most cases, business models like that won’t be long for this world. Consumers are increasingly fed up with bogus legal restrictions that try to prevent what the technology clearly allows. If you’re trying to create a business model, the second you consider putting in ideas that inherently limit your consumers from doing what they want, you’re asking for trouble. A smart business model enables more customers to do what they want, and does so in a way that makes everyone better off. While there are still companies who can get away with anti-consumer business models enforced by overly restrict contracts, it’s not a long term strategy for success.

Filed Under: business models, restrictions

Shepard Fairey Destroys Evidence, Goodwill; Harms His Case For No Good Reason

from the grow-up dept

On Friday morning, someone “working with” Shepard Fairey alerted me that some news was coming out that day about his lawsuit with the Associated Press over his famous Barack Obama poster:

I finally got the “official” statement from Fairey late on Friday, just as I was about to leave work for the weekend, and the whole thing was so ridiculous that I just figured I’d leave it until today. Apparently, Fairey, for absolutely no good reason, tried to destroy evidence and then lie about which photo he actually used to make his poster. He’s now come clean about this, and while he’s right in his statement that this shouldn’t have any impact on the underlying case, it certainly doesn’t help. It was already pretty well known that Fairey was hardly the poster child of fair use — given that he has a history of going after others who copy his own work, despite being an “appropriation artist” himself. But, even so, this is beyond dumb — something I don’t say lightly.

Fairey still has a very strong fair use claim — which is entirely separate from the question of whether or not Fairey did something incredibly stupid here. Even if he used the image the AP claimed he did (which he now admits), it still seems like this is an obvious case of fair use. But destroying evidence and lying — especially when there was no good reason to do so — just harms his credibility and makes it that much more likely that he’ll lose his case not for any legitimate reason, but because of his own separate actions in dealing with this case. There are important fair use issues at play here, and Fairey just made it that much harder to maintain the high ground.

While some are pointing out that this is the sort of thing that happens when copyright laws always seem to stack the deck against fair use, that’s still no excuse for lying and trying to destroy evidence. Yes, the system sucks, but doing something like this only harms an otherwise strong case.

Filed Under: copyright, evidence, fair use, lies, shepard fairey

Using A Security Breach As An Upsell Opportunity?

from the shameful dept

Danny Sullivan has a blog post blasting Citibank for how it handled a security breach, requiring him to get a new credit card. Apparently a vendor where Sullivan had used the card had a breach, meaning Citibank sent him a new card. But did they tell him which vendor it was so that Sullivan could avoid doing business with them in the future? Of course not. But much more insulting is that when he went to activate the new card, Citibank tried to upsell him on a credit check offering. As Sullivan notes, shouldn’t Citibank be offering that to him for free? It’s probably cheaper than having to send out thousands of new cards every time a vendor screws up. Of course, when Sullivan points that out to the person on the phone, the person at the other end says “we’re just the activation department, you’d have to talk to customer service for that.” Of course, if they’re just the activation department, why are they doing sales as well? I’m sure the big banks will claim that these sorts of sales processes work in that enough people are suckered into these high margin upsell offerings, but wouldn’t it be nice to have a bank that actually treated customers well?

Filed Under: security breach, upsell
Companies: citibank

Why Would The Copyright Lobby Be Concerned About An Anti-Spam Bill?

from the because-it-may-hurt-their-rootkits dept

Up in Canada, there have been ongoing discussions and negotiations over an anti-spam law. While I have various reservations over anti-spam legislation (here in the US it’s done little to stop spam, but plenty to outline how to “legitimately” spam people), it’s a bit surprising to find out that the copyright lobby is heavily involved in the process as well. Why would the copyright lobby care about an anti-spam bill? Apparently, they’re afraid that it’ll hinder their use of DRM, since the current bill requires consent before installing software on computers. And, as we learned in Sony’s famous rootkit debacle, plenty of DRM works by surreptitiously installing software that watches what you do with content. Of course, the last thing the entertainment industry would want is to be required to be 100% upfront and truthful with you when it’s installing spyware/DRM on your computer. That would — in their minds — defeat the point.

So, the copyright lobby has been making sure to water down the bill, to try to cut out the language that would cover their use of surreptitious spyware/DRM:

Sources say that the Liberals have introduced a motion that would take these practices outside of the bill. In its place, they would define computer program as, among other things, “a program that has as its primary function…inducing a user to install software by intentionally misrepresenting that installing that software is necessary to safeguard security or privacy or to open or play content of a computer program.” This sets such a high bar – primary function, intentional mispresentation – that music and software industry can plausibly argue that surreptitious DRM installations fall outside of C-27.

And, of course, once the copyright lobby can put spyware on your machine, they want to be sure they can spy on you and use that information against you:

PIPEDA currently features a series of exceptions to the standard requirements for obtaining consent for the collection of personal information (found in Section 7). Bill C-27 includes a provision that bars those exceptions in cases involving computer harvesting of email addresses and the “collection of personal information through any means of telecommunication, if the collection is made by accessing a computer system or causing a computer system to be accessed without authorization.” In other words, email harvesting and spyware would not be permitted and would not qualify for the PIPEDA exceptions found in Section 7.

The copyright lobby is deeply concerned that this change will block attempts to track possible infringement through electronic means. The Section 7(1)(b) exception in PIPEDA currently states that collecting personal information without consent or knowledge of the individual is permitted if it is reasonable to expect that the collection “would compromise the availability or accuracy of the information” and the collection is “related to investigating a breach of an agreement or a contravention of the laws of Canada.”

It’s really stunning what kind of sense of entitlement the entertainment industry has — insisting that it should have the right to install spyware on your computer without you knowing about it, and to then collect all sorts of private info about you and what you do on your computer. Shameful.

Filed Under: canada, copyright, spam