Ron Wyden Presses FTC For Disclosure Rules On Ownership Rights Of Digital Purchases
from the finally dept
We talk a lot here about the concept of “ownership” of what we spend money on, particularly as it relates to purchases that are digital or have some reliance on internet connectivity. Despite being related, those two categories are actually quite distinct.
On the one hand, you have situations where a company may go out of business, or a business may no longer “support” a product it sold, where backend infrastructure also gets shut down and results in sold products no longer having the same functionality or, in some cases, becoming expensive paperweights. Some advocate groups have already pressed the FTC to do something, anything about all of this, such that some consumer rights are conferred to the victims of this behavior.
Then there are the purely digital “purchases,” wherein the public is typically not actually buying a “thing,” but rather a limited license to access said thing. Video games, digital music files, and eBooks all come to mind here. Nobody has done all that much on that front, save for some platforms aiming to force sellers to disclose some ownership rights and some companies being a tad more public about how it isn’t actually selling “things” like the public thought.
Senator Ron Wyden appears to be interested in changing that. He has written to the FTC, urging them to require companies to be far more transparent before and during the sale of digital goods as to what ownership rights the buyer actually has.
Wyden’s letter, shared with The Verge, requests guidance to “ensure that consumers who purchase or license digital goods can make informed decisions and understand what ownership rights they are obtaining.”
Wyden wants the guidance to include how long a license lasts, what circumstances might expire or revoke the license, and if a consumer can transfer or resell the license. The letter also calls for the information “before and at the point of sale” in a way that’s easily understandable. “To put it simply, prior to agreeing to any transaction, consumers should understand what they are paying for and what is guaranteed after the sale,” Wyden says.
This simply isn’t a position that should come with much controversy. Consumers knowing what they’re actually buying based on clear and transparent language isn’t a big ask. Hell, it should have been considered table stakes from the beginning. And any pushback from anyone in the digital industries would be very, very telling.
Why would you want to fight back against a requirement that your customers know what they’re buying from you, after all?
“The shift from physical to digital goods presents some complex legal questions,” Wyden says in the letter. “One thing is clear, however: consumers deserve transparency about their ownership rights in digital goods. Guidance from the FTC on this issue will help ensure that digital goods sellers are aware of best practices and that American consumers can make informed buying decisions.”
This should be an absolute slam dunk of a request. And if some ground rules about disclosure can finally be put in place, perhaps we’ll finally have an end to the shock in some cases when a person’s purchases are suddenly whisked away without recourse.
Filed Under: digital goods, ftc, ownership, ron wyden
Comments on “Ron Wyden Presses FTC For Disclosure Rules On Ownership Rights Of Digital Purchases”
This comment has been flagged by the community. Click here to show it.
Radiant IT services
Senator Ron Wyden is absolutely right—consumers deserve full transparency regarding their digital purchases. Too often, people buy digital content assuming they ‘own’ it, only to realize later that they’ve merely acquired a revocable license. Businesses must be held accountable for clear disclosures on digital ownership rights before purchase.
At Radiant IT Services, we emphasize ethical digital transactions and consumer rights. Ensuring transparency in digital goods is not just a legal issue but a trust issue between businesses and customers. The FTC taking action on this matter would be a step in the right direction for consumer protection!”
Imagine if people understood that their purchase didn’t even guarantee them being able to use it in 3 weeks.
Its rather shocking that they still don’t have to mention the intrusive DRM & always online required for single player games.
The industry is going to hate this because no one is going to pay top dollar for a game that they can’t promise will work in 6 months or that they can’t trade off or pass on.
Re: Which industry?
If you’re talking about games, or music, or digital video, the ‘industry’ will carry on just as they have done for the last 30+ years. They’ll still sell the limited licenses they always have done, and that the more savvy consumers are already aware of. A few consumers might be put off, but most have had their fingers burnt at least once by now and are already wary of digital… but still buy anyway because the convenience of the purchase suits them.
Re:
When I’ve talked to people about this and similar issues… most don’t give a rip.
In computer security we have the term “dancing pigs”. It basically state “given a choice between security and dancing pigs, the most people will chose dancing pigs every time”
In other words: It’s not a problems that’s holding and ax and going to murder them in the next 5 seconds, so they will ignore it, and buy what ever shiny thing they have been “sold” on.
FTC guidance IS a good start. However I can’t seen a constitutional way to prevent people from willingly offering themselves up to be screwed over.
Re: Re:
To clarify my last sentance: Ideas for convincing people not to “offer themselves up to being screwed over” are great. But laws that actually prevent it (instead of doing something like making them more informed, and trying to convince them to be sane) are likely inherently unconstitutional.
A actually functional education system (not the festering mess I’ve heard about) might be a great start.
Re: Re: Re:
Lord help me but like a nutrition box with details.
License is only good for 1 computer, if it dies get another copy.
points down in threaded view the AC below lists other things that would be good to know.
You can lead a horse to water, you can’t make them drink but that is no reason to not put up a sign warning there are crocodiles in this waterhole.
Re: Re: Re:2
Yup. I’m not at all against putting up the signs. Just expressing concern that… the way most people will react is “too long; did not read”
It's not enough
Okay, let’s say that a company offering an exclusive product clearly states:
1. License duration: As long as you’ve got access to your account.
2. License expired/revoked: See 1., or it right owner revokes the license, or for other legal reasons, or if the company goes out of business.
3. License transferring/reselling: Don’t even think about it.
There is a lot of little details that this doesn’t answer, like:
* What if an update (of the product or software to run it) breaks it, or makes it unusable?
* What if my device is too old, no longer powerful enough?
* What if I don’t agree with later added security measures (2FA, passkey)?
* What if my product/account gets hacked?
* What if the company has been sold to another one that will change the license?
* If the license gets changed, can I ask for a refund?
Too right. Everyone likes to say, “Caveat emptor,” but that only applies if you know exactly what you’re purchasing and should not be used to victim blame anyone on the wrong end of obfuscatory sales practices.
Wyden is like one of the few sane senators when it comes to the digital world.
We’re gonna be doomed the day he’s gone, as if we weren’t already.
Re:
He’s one of the few sane and good elected persons, full stop.