Apple, Amazon Team Up To 'Enhance Customer Experience' By Limiting Customers' Options

from the *enhanced-customer-experience-may-require-bending-over dept

The “right of first sale” still exists. Not that Apple’s happy about it. Apple’s no fan of right-to-repair laws either, preferring to keep its revenue streams nice and deep by forcing customers to get their repairs only from Apple-approved vendors, no matter what the law actually says.

So, yeah, you still have the right to resell your Apple products. You’re just not going to do it in the largest marketplace in the United States. This CNBC article delivers the bad news like it’s good news.

In a new agreement between tech giants Amazon and Apple, shoppers will soon see a selection of the latest Apple products on Amazon.com, Amazon told CNBC in statement.

The agreement means the latest Apple products like the iPhone XR, XS and XS Max will be available on Amazon.

Both companies issued statements about improving customer experiences, but nothing about this sounds like a better deal for consumers. It’s a paywalled garden guarded by Apple and Amazon that will keep all but a select few resellers from participating. Being an Apple reseller/repairer is pay-to-play.

First, Apple has to be convinced you’ll do more for it than it will do for you. Then you have to pay for the privilege of being allowed to exercise your first sale rights.

Independent shops pay Apple a fee in return for “authorized” status, which gets them exclusive access to Apple training and guidebooks and the ability to buy parts directly from Apple. But authorized repair shops are only “authorized” to do a select few repairs; if a customer comes in with other easily fixable problems, the repair shop must ship the phone to Apple.

This “improvement” of “customer experience” means more old Apple products will be headed for landfills than other people’s homes. Jason Koebler of Motherboard interviewed John Bumstead — a reseller who buys old MacBooks from recyclers and, until recently, sold the refurbs on Amazon. Bumstead was just informed he was no longer welcome at Amazon, thanks to the new deal with Apple.

Bumstead had a good thing going — something that worked for him and the environment. But Amazon’s refurb program — as modified by Apple — only wants to deal with people who have the capability to feed a bunch of money to Apple before reselling used devices.

Amazon currently has its own “certified” refurbisher program called “Amazon Renewed” that will be unaffected by the new deal with Apple. But the requirements to sell Apple products under that program are impossible to hit for any small business: They must prove to Amazon that they spend at least $2.5 million dollars every 90 days buying Apple products “directly from a national wireless carrier or retailer with over $5 billion in annual sales (Example: Verizon, AT&T, or Target) or the manufacturer (Apple.)” This means that only big companies with direct relationships with corporate giants can meet the requirements.

This doesn’t do much for customers seeking affordable Apple products. Apple continues to set the literal gold standard with its phone and laptop pricing. Severely curtailing the options Amazon customers have for affordable devices doesn’t sound like an “improved customer experience,” but those are the empty words both companies are using to sell this.

Now, Apple and Amazon are free to handle refurb sales however they wish. There may be a “right to first sale” just like there’s First Amendment speech protections, but the actions of private companies don’t infringe on that right. They’re free to de-platform anyone for almost any reason. You can resell your Apple stuff. You just can’t do it here.

I’d say it isn’t wise for Apple to take such an antagonistic stance against its customers, but its aggressively anti-consumer efforts haven’t made much of a dent in customer goodwill. It may attract the occasional attention of regulators, but not often enough to result in a softened stance on resale or repair. The problem is Apple’s actions make things worse for customers who have never purchased its products. Homogenizing marketplaces rarely results in better prices and its anti-right-to-repair efforts are funneling customers towards a select few outlets and preventing device owners from enjoying the privileges of ownership.

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Companies: amazon, apple

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Comments on “Apple, Amazon Team Up To 'Enhance Customer Experience' By Limiting Customers' Options”

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21 Comments
Mason Wheeler (profile) says:

This is just an extension of what’s been going on for decades in software into the world of hardware.

Fun fact: the right of first sale (or "First Sale Doctrine," as it’s more commonly known as) originated in a 1908 case where a book publisher tried to put what we would today call a EULA on one of their books, placing additional restrictions on how it could be resold and stating that it would be considered a copyright violation to not comply with these restrictions.

People thought that was ridiculous, and it eventually ended up in court, going all the way to the Supreme Court, where the Supreme Court established that a publisher has no right to put a EULA on their published works; that copyright law granted exactly the specific protections that it says it grants and nothing else, and once you’ve sold the work to a third party, the property rights (ie. right to control how it is used) not specifically covered by copyright transfer to the new owner and they’re free to use it as they wish.

In 1976, this doctrine was upgraded from "case law" to "real law" when Congress passed a new Copyright Act that codified the concept. It ought to be pretty solid and unassailable at this point, but it wasn’t too much longer after that when publishers of computer software, rather than books, started putting EULAs on their work. And unfortunately, so far they’re winning after a truly horrible 9th Circuit ruling flew in the face of a century of precedent and established the validity of Autodesk’s EULA, and then the Supreme Court declined to review the case.

Now that the bad guys have their foot in the door, they’re working on eroding the First Sale Doctrine elsewhere, such as by undermining the right to access and repair your own property. And after decades of systematically weakening laws against anticompetitive behavior, you end up in a situation where blatantly evil crap such as:

[Amazon is] free to de-platform anyone for almost any reason. You can resell your Apple stuff. You just can’t do it here.

is actually legally valid!

How much more is it going to take before we start pushing back and demanding en masse that Congress pass laws that uphold our rights to our own property?

Thad (profile) says:

Re: Re:

While I am concerned about the erosion of first-sale doctrine (via EULAs, DRM, etc.), I think you’re conflating two separate but related issues here.

Of course "[Amazon is] free to de-platform anyone for almost any reason. You can resell your Apple stuff. You just can’t do it here" is legally valid. First-sale doctrine gives you the right to resell products, not the obligation to.

On what legal basis would you say Amazon should be legally required to allow users to sell refurbished Apple products on its platform? You might be able to make an antitrust argument to that effect (though Lord knows there are still plenty of other online retailers where people can resell used goods, including eBay), but I don’t think there’s any legal merit to the suggestion that first-sale doctrine requires middlemen to allow certain types of products to be sold through their storefronts.

Mason Wheeler (profile) says:

Re: Re: Re:

There’s some important nuance here. It’s not so much that they “should be legally required to allow users to sell refurbished Apple products on its platform,” as that, once they have already allowed it, they should not be permitted to enter into an exclusive agreement with Apple that kicks these established users off. That’s classical anticompetitive behavior, and Apple ought to get dragged into court over it if there was any sanity in this world.

Thad (profile) says:

Re: Re: Re: Re:

Yeah, that’s kind of what I’m getting at. There may be a good legal argument that this is anticompetitive, but the legal argument isn’t a first-sale argument. First sale is related, because this is part of a pattern of behavior on Apple’s part to restrict refurbishment and resale, but the legal argument for keeping refurbed Apple products on Amazon isn’t itself a first-sale argument.

Anonymous Coward says:

Re: Re: Re:

On what legal basis would you say Amazon should be legally required to allow users to sell refurbished Apple products on its platform? You might be able to make an antitrust argument to that effect (though Lord knows there are still plenty of other online retailers where people can resell used goods, including eBay)

A company does not necessarily need to be a monopoly or near-monopoly to violate antitrust law, even in the USA.

Anonymous Coward says:

never have and never will buy anything ‘Apple’! everything about the name is too restrictive, from the options in this article to what you can do with a device you paid damn good money for, but, like (and thanks too) the stupidity of USA judges or ease of them being bought off and the greed of the entertainment industries, we now do NOT own what we buy! how fucking ridiculous is that??

Rico R. (profile) says:

It's all in the name!

People have always wondered why Apple products start with “i”: iPhone, iPod, iPad, etc. But it’s not that they begin with “i”, but rather “iP”. Get it yet? “iP”? IP? Intellectual Property? Apple’s beliefs that IP laws are there to enforce their anti-consumer will because it’s more profitable for them? Cue the Illuminati music… Apple just got their true colors exposed! Why else would they want people not to exercise their first sale and repair rights?

Jak Crow (profile) says:

Glad I left

I worked for apple for almost 5 years and each time the company pulled some bullshit like this, it just made me doubt the company more and more. When the company was found guilty of e-book price fixing, the execs kept telling the employees “the company” did nothing wrong and “apple” was innocent. I suppose that’s true when it was the execs involved that were responsible, but lets not quibble. The company kept pulling shady shit and I couldn’t stand it any more.

Jeff (profile) says:

no surprise - Amazon is worse than Apple

on Oct 29, 2018 my kindle paperwhite v3 received a sw update which removed ‘inverse’ or ‘dark’ mode and also the option to display the clock while reading.
Interestingly, the paperwhite v4 came out right around that time and guess what. It has ‘inverse’ reading mode and clock display.
In my experience Apple has never de-featured an older model to sell a newer one so IMO Amazon is much worse.

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