California's New Law Forces Digital Stores To Admit You're Just Licensing Content, Not Buying It (theverge.com)
- Reference: 0175138409
- News link: https://news.slashdot.org/story/24/09/26/1645241/californias-new-law-forces-digital-stores-to-admit-youre-just-licensing-content-not-buying-it
- Source link: https://www.theverge.com/2024/9/26/24254922/california-digital-purchase-disclosure-law-ab-2426
> When the law comes into effect next year, it will ban digital storefronts from using terms like "buy" or "purchase," unless they inform customers that they're not getting unrestricted access to whatever they're buying. Storefronts will have to tell customers they're getting a license that can be revoked as well as provide a list of all the restrictions that come along with it. Companies that break the rule could be fined for false advertising.
[1] https://www.theverge.com/2024/9/26/24254922/california-digital-purchase-disclosure-law-ab-2426
Unintended consequence (Score:2)
You give them an easy out to shut down the service when it trends unproductive.
Re:Unintended consequence (Score:5, Insightful)
How is that different from now?
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The illusion of ownership might have made large companies at least try to ride out some down periods. Now, freed of even the need to pretend, they may shutter things more aggressively.
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They have always been free to call it a lease. They chose not to.
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Indeed. If there were any expected benefit to calling it a lease, they would have done so all along. That they haven't strongly suggests that the perceived advantage is in calling it a sale, even though it's not.
The concern, obviously, isn't that it will make big companies act differently during a down period, but rather that it will cause a down period as people are informed that what they're buying isn't what they want. And honestly, they probably should be concerned about that.
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Not quite. The difference before is explicitly calling it a lease even when your competitors don't. That would be a competitive disadvantage. Now it's a level playing field.
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The same rule applied to everyone before. The same rule applies to everyone now. It's a different rule, but it's just as level a playing field.
Re:Unintended consequence (Score:5, Interesting)
> You give them an easy out to shut down the service when it trends unproductive.
Right. The law should instead demand that if something looks even slightly like a sale, the seller is responsible for making it act like a sale . That means, among other things, that:
In the event that a company decides to stop running a service, goes out of business, or is otherwise unable or unwilling to continue making a sold work function, that company must either (at its option) A. provide a way for customers to obtain the same offering through another service or B. provide a 501(c)(3) organization with an endowment sufficient to let them continue to operate the license servers in perpetuity.
The selling company must provide support for transferring those licenses individually to other people (even after they choose to shut down, if applicable).
The company choosing to drop a specific product does not absolve them of these obligations.
The company may not enter into any licensing agreements that would cause them to violate these obligations, including but not limited to time-limited licenses to a specific property from a content creator unless those contracts include a provision for perpetual access to any purchased copies.
And so on. The law needs to clearly lay out a list of those obligations so that no one is surprised, along with statutory penalties per violation. Otherwise, this will likely just end up turning into a series of class action court cases where everyone loses.
But a statutory penalty equal to the sale price of the sold work plus $5, payable to the original purchaser, would get people's attention, because any company that ends up violating such a law could quite easily be forced into bankruptcy. And that is how you write a law that has some actual teeth.
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Alternatively, allow them to issue a patch that ONLY removes the DRM. Additionally, if game functionality requires a server, the patch should allow configuring an alternate server and a release of everything needed to stand up a server as freeware.
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> Alternatively, allow them to issue a patch that ONLY removes the DRM. Additionally, if game functionality requires a server, the patch should allow configuring an alternate server and a release of everything needed to stand up a server as freeware.
For content that they actually own, sure. And in that situation, they also obviously have the right to sell things without adding any sort of DRM in the first place. I was speaking more about content that a company licenses from other companies and then sub-licenses to consumers. But yeah, that's a good point.
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So either ban the "sale" of that, or allow the "sale" as long as you have the buyer type in "I understand that this is temporary and can be revoked at any time for any reason without refund".
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The seller sells the product, but the developer/publisher is what decides if things will suddenly stop working. So, if a game requires a working server in order to work, shouldn't the attention be on these companies that develop/publish the game and not the seller? Should Steam have to refund the price for a game sold 5+ years ago because the game developer went out of business or just shut down the service?
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> The seller sells the product, but the developer/publisher is what decides if things will suddenly stop working. So, if a game requires a working server in order to work, shouldn't the attention be on these companies that develop/publish the game and not the seller? Should Steam have to refund the price for a game sold 5+ years ago because the game developer went out of business or just shut down the service?
Ideally, yes. Steam should have to refund the purchase price plus $5. If Steam were required to do that, Steam would very quickly change their contracts to require those game developers to put up a bond for the continued maintenance of those servers in perpetuity or provide other continuity of service plans before they can sell their games on the Steam store, and the problem will simply solve itself.
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>> You give them an easy out to shut down the service when it trends unproductive.
> Right. The law should instead demand that if something looks even slightly like a sale, the seller is responsible for making it act like a sale . That means, among other things, that:
>
> In the event that a company decides to stop running a service, goes out of business, or is otherwise unable or unwilling to continue making a sold work function, that company must either (at its option) A. provide a way for customers to obtain the same offering through another service or B. provide a 501(c)(3) organization with an endowment sufficient to let them continue to operate the license servers in perpetuity.
> The selling company must provide support for transferring those licenses individually to other people (even after they choose to shut down, if applicable).
> The company choosing to drop a specific product does not absolve them of these obligations.
> The company may not enter into any licensing agreements that would cause them to violate these obligations, including but not limited to time-limited licenses to a specific property from a content creator unless those contracts include a provision for perpetual access to any purchased copies.
> And so on. The law needs to clearly lay out a list of those obligations so that no one is surprised, along with statutory penalties per violation. Otherwise, this will likely just end up turning into a series of class action court cases where everyone loses.
> But a statutory penalty equal to the sale price of the sold work plus $5, payable to the original purchaser, would get people's attention, because any company that ends up violating such a law could quite easily be forced into bankruptcy. And that is how you write a law that has some actual teeth.
It's a good thing you're not in policy. This is the kind of suggested law that would trigger the law of unintended consequences.
The net result of this would be that to provide an endowment into a non-profit or alternative service to let customers keep using things in perpetuity would give all game publishers complete justification to increase the price of all games. The purpose is for insurance; if they law requires them to fund some sort of "in perpetuity" maintenance of service, then they need to ge
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> The net result of this would be that to provide an endowment into a non-profit or alternative service to let customers keep using things in perpetuity would give all game publishers complete justification to increase the price of all games.
They don't need justification. Supply and demand says that they will raise prices as much as the market will tolerate. Being able to keep using things in perpetuity doesn't mean that they will. The amount of time you spend playing a game drops off over time until it approaches zero, except for occasionally going back to replay it for nostalgia, so the value doesn't necessarily increase noticeably when you extend the lifetime, which means that the perceived increase in value *won't* justify raising the pr
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Well this is a good start. Something they didn't but SHOULD have added to the law is a clause forbidding revokation without a full refund: Of licenses or access on purchases that have already been made that were described as a "Purchase" at the time of sale.
It should have been a: "Requirement to Issue refund of the purchase amount.
An online service or storefront provider who revokes, removes, or discontinues access or license to use of goods, services, "downloadable content", "addons", or "microtransact
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You would be retroactively putting all revenue ever derived from those sales back on the books on the liability side of the balance sheet, effectively restating all financial positions in the history of the providers.
That is why you can only make these changes going forward.
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> You give them an easy out to shut down the service when it trends unproductive.
They've always been allowed to state that it wasn't a purchase, and so could have created that "easy out" on their own.
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> You give them an easy out to shut down the service when it trends unproductive.
What'd you think the point was? It's an 'easy out' because they won't piss off their customers if they understand what they're paying to.
While in the EU (Score:2)
The initiative to get politicians discuss what the exit strategies on videogames should be is still collecting signatures. At around 35%, it still is way too far from the goal. Website is now offering flyers you can print!
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It's actually off to a good start since 31/07/2025: [1]https://citizens-initiative.eu... [europa.eu]
There are 360,000 signatures and four countries (Germany, Poland, Sweden and Finland) have already met the minimum.
It requires 1,000,000 signatures and seven countries need to meet the minimum.
The deadline is 31/07/2025.
[1] https://citizens-initiative.europa.eu/initiatives/details/2024/000007_en
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...since 31/07/2024 obviously.
Not good enough! (Score:2)
> [...] it will ban digital storefronts from using terms like "buy" or "purchase," unless they inform customers that they're not getting unrestricted access to whatever they're buying [...]
Damn it, that's not good enough!
If you don't actually end up owning unrestricted access to what you're paying for in perpetuity, then the only acceptable term to use is "Rent" - nothing else!
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What about leasing or 'buying a subscription for [period of time]"?
As long as it is clear you're not actually going to own anything. And shouldn't this already be so clear in consumer law that a class action or something would be viable?
It's sad we keep needing new laws to cover "stop lying to get people to give you money".
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> What about [...] 'buying a subscription for [period of time]"?
The word "buy" is still in there, which has specific meaning to people: that they're actually "buying" something, regardless if you try to add words like "subscription", "limited", "temporary" or whatever else to 'limit' or redefine what the word 'buy' means in the context of paying money for something (same would apply for "purchase" instead of "buy"). That leads to ambiguity.
The reason I say it's not good enough to 'limit/redefine' what the word "buy/purchase" means is that it allows wiggle-room to be amb
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Rent isn't the correct term either, most of the time. Rent implies x dollars for y amount of time. For these digital products, there is no defined y amount of time.
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> Rent isn't the correct term either, most of the time. Rent implies x dollars for y amount of time. For these digital products, there is no defined y amount of time.
Nor is there currently any defined ownership when "Buy" is used.
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If you are buying something that on the box requires Internet access and to connect to a server, then yea, you own something that can't work because the server it was designed to work with isn't there now. Not all games are single player unconnected games.
Should Have Forced Them To Actually Sell It (Score:2)
They still are allowed to rip people off-just be open about it.
Control of your media (Score:3)
Don't lease, don't pay for subscriptions.
Regarding music and movies: You either have to have physical media, or you need non-DRM'd files.
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People buying cartoon apes on the blockchain accidentally found the solution. But ruined the credibility by creating 100's of scams and ponzi schemes instead of solving the hard problems of how to distribute a transferable title of ownership for content that people would actually want to use and enjoy.
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That's a very interesting point. In combination with a blockchain ownership system we could add non-duplicative resale ability to make digital sales like physical sales, although I'd suggest also adding an ability to loan an item. Of course, that would dramatically alter the sale price, as unlike physical objects there's no wear and tear and people don't need to physically meet to transfer it.
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And "physical media" that actually *contains* the thing. It's mostly a safe bet with music and movies but I used to think that about games, and now a disc (if there even is one) may only be basically the barest portion of anything and a key to download the game from somewhere. Gotta watch these creeps, or they'll do it with movies and music next, and we might miss the trick.
Been going on since the '80's (Score:2)
I remember the first big shock wave when the very popular database software DB II quietly changed and their software to say you bought a license to use the software you didn't own it that was mid-1980's. People wemt nuts and slowly calmed down as more software started doing the same thing. PC software was starting to be sold like mainframe software always was.
As usual people brought this on themselves, software was expense but easy to copy and give to others. Companies would buy ten copies for a a hundre
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No, the companies screwed themselves. "Revoking" a license has never prevented a pirate from enjoying their freebie. It has caused a ridiculous amount of effort and headache for legitimate customers at their personal expense.
If your product is ridiculously expensive to make the first copy of and ridiculously easy to replicate once created, you'll never make up the costs of development in volume sales. That's economics 101. These companies have a broken business model that doesn't work in the modern world
1-click cancellations (Score:1)
A law requiring one-click subscriptions be paired with 1-click cancellations was also signed into law a couple of days ago.. While I disagree with Newsom on most (nearly all) things... They've managed to roll out a few good laws over the last few months. I'll give credit where credit is due.
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> A law requiring one-click subscriptions be paired with 1-click cancellations was also signed into law a couple of days ago.. While I disagree with Newsom on most (nearly all) things... They've managed to roll out a few good laws over the last few months. I'll give credit where credit is due.
If the company isn't located in California then CA has no legal standing to try and regulate the transaction or behavior. Other than encouraging businesses to move their operations outside of CA jurisdiction it's really not going to do much, so I would hesitate to call them "good laws" even if the intentions look good.
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> If the company isn't located in California then CA has no legal standing to try and regulate the transaction or behavior. Other than encouraging businesses to move their operations outside of CA jurisdiction it's really not going to do much, so I would hesitate to call them "good laws" even if the intentions look good.
Yeah.. that's not how it works..
State laws regarding the internet can apply to businesses located outside the state if they are actively doing business with residents of that state, meaning they are soliciting customers or conducting transactions with people within the state's jurisdiction, even if the business itself is physically located elsewhere; this is particularly relevant for online businesses that operate across state lines.
Courts typically apply the "minimum contacts" test from the case Inte
Educationg the clueless (Score:2)
People who pay attention already know what's going on
I guess it's a kinda good thing to educate the clueless
I would prefer that companies change their policies
Theyâ(TM)ll Bury it in Fine Print (Score:2)
Then claim that the customer agreed to it.
If every customer read every word of fine print, the US economy would collapse overnight, as customer after customer took the time necessary to read all of the terms, including the linked terms, and the terms linked from the linked terms.
That is why companies let you agree to 27 pages of fine print after 2 seconds, then claim that you agreed to them.
Most companies owe their very existence to people not reading them, and the whole thing is childish and embarrassing.
C
Software services on hardware (Score:1)
I wonder how this would affect the following case.
Once upon a time I bought a cool clock from Sony that you could download cool faces and software that made it do different things.
Then sony shut down the servers.
Then my cool clock was just a clock with nothing special except an expensive purchase price.
A better term: lease (Score:3)
A better term seems to be to state that they are "Licensing a lease". Everyone (?) knows a lease isn't forever. Even a "perpetual lease" or "forever lease" has exit clauses.
Re: A better term: lease (Score:5, Insightful)
I can't recall seeing a lease that is a single payment for an indeterminate length of time. Just my opinion but I think that word implies monthly upkeep payments, like Sony PSPlus game offers, but would feel wrong for one-time payments for persistent library title slots like Steam.
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I can't recall seeing a purchase that can be revoked without refund at any time in the future. For a physical object that would involve breaking into your house to take the thing.
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A lease suggests people will be paying for something for as long as they have it. I've had games I had purchased on Steam for over a decade, the only complaint would be if Steam "turned me off" for breaking the rules. Now, that is where people have become spoiled. If you bought a game back in the days of Windows XP and it doesn't work on Windows 7, 8, 10, or 11, most people would either look for a fix, or just shrug that it's an old game that won't work. What happens when you buy a game on Steam? P
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> All of this should be seen as common sense that any program won't work forever
Why not? Why should an online game or hardware thing stop working just because the company that produced it doesn't want to operate the backend?
Sensible right-to-repair legislation would require that companies retiring their severs provide enough information (documentation, software, keys, etc.) to allow users to continue to support it, should they choose to do so. Hobbyists go to great lengths now to keep abandoned games hardware running. I have little doubt we'd see hobbyist communities spring up dedic
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How does this affect sales tax?