from the a-disaster dept
It seems like every week there is a debate about a new topic involving ownership rights. Consumers are engaged in a constant tug of war with rights holders over what they can do with the products that they already purchased from them. A wide array of questions has confused the understanding of fundamental issues such as when people can resell or repair the things that they bought. The First Sale Doctrine stipulates that a rights holder is no longer entitled to control the distribution of a good once it has gone through a legitimate first sale. However, recent technological developments have created a new disagreement to this long-standing law -- do people ever actually own the things that they purchased? Were the products ever truly sold to them, or is everything instead just a temporary lease?
Take the recent debate over Nest products. Nest is one of the leading companies in "smart" thermostats for personal use. These products utilize a variety of light, sound, and heating sensors to automatically regulate the climate in a home and increase energy efficiency. Back in 2014, Nest purchased a company named Revolv that also made "smart" thermostats and proceeded to continue selling them for $300 each.
This once promising acquisition soon turned into a highly publicized controversy when Nest recently announced that it would be disabling the Revolv product line. At first glance this hardly seems worthy of news coverage. This is not the first time that a company has decided to suspend sales and maintenance of an older product. For example, Microsoft stopped maintaining Windows XP and the Zune, while video game companies slowly stop making new products for their old systems (eg. Playstation and Xbox) upon the release of a new platform. The Nest case has become a lightning rod because as opposed to these examples, it's not just stopping the maintenance, upkeep, or the addition of new features. Nest will shut down the device entirely, rendering it as nothing more than a $300 doorstop.
How can a product that was purchased legally by a consumer be turned off by a flip of the switch by the company that sold it? The answer is as simple as it is troubling -- it is because that consumer does not in fact "own" the product. Yes, they own the physical device. But they only lease the software embedded inside the product that makes it go. And because this is a license, the company that made the product retains the right to shut it down. The product was not sold with any stipulation on the box that said that it carried this risk. A consumer would have to be a copyright lawyer to foresee this result.
Every day new telephones, watches, cars, books, and even household appliances like refrigerators are introduced into the market and have had a tremendously positive impact on our lives. An increasing number of products that did not contain any software five or fifteen years ago now do. As this trend continues to grow, the same phenomenon will grow with it. You will own less and less of your own products and will instead simply be leasing them. Maybe one day you will wake up and discover that you are out $300 because the company decides it would rather sell you a different product and shut yours down.
This is not just limited to electronic products. The use of a license to control the resale of a variety of other, totally unrelated products has also grown substantially. Sports teams like the New York Yankees, Golden State Warriors, and Minnesota Timberwolves have all started to use the very same tactic. You might buy a ticket to the event, but you can no longer freely sell it, donate it to charity, or give it to a friend like any other product that you would purchase. Teams are forcing ticket owners to either sell through a select service (of which they get a cut of the revenue), or get their tickets revoked. These services set a variety of economic controls, such as a pricing floor, in order to limit the ability of people to freely exchange the tickets that they lawfully purchased.
As technology continues to be intertwined with every day goods and services, we have to ask ourselves if we want to accept the erosion of our ownership rights. My organization, and those that we work with do not believe so, and will continue to fight to make sure that you do, indeed, own the things you own. A variety of large and small companies and associations have come together to form the Owners' Rights Initiative. ORI has worked with members of Congress of both parties such as Blake Farenthold and Jared Polis in order to ensure the protection of every persons' ownership rights. They've introduced the You Own Devices Act, or, YODA, to ensure that essential software travels with the hardware you purchase. Representatives Farenthold and Polis are leaders in this arena, and ORI is working to build even more champions. Join us in the fight by contacting your Congressman and Senator and asking them to cosponsor YODA.
Lyle Gore is CEO of Ethos Dynamics, a technology reseller in Atlanta, Georgia. He is the past-President of the United Network of Equipment Dealers (UNEDA) and represents the organization on the Steering Committee of the Owners' Rights Initiative.