[Infowarrior] - EFF: Comparing iTunes Terms of (Ab)Use

[Richard Forno]

Terms of (Ab)Use: US and UK Consumers Dance to Different iTunes  
Commentary by Ed Bayley
http://www.eff.org/deeplinks/2010/01/terms-ab-use-dancing-different-itunes-differences-
Too often, online services draft their "Terms of Service" (TOS)  
agreements in ways that are one-sided and overreaching. In Europe,  
however, regulators are beginning to step in to protect consumers. In  
late November, the U.K.'s Office of Fair Trading (or OFT) announced  
that Apple, Inc. agreed to change the terms and conditions for its  
popular iTunes online music store in the United Kingdom. In  
particular, according to the statement from the OFT, the changes make  
the iTunes terms "clear, fair and easy to understand," and, more  
importantly, give consumers "clear and accurate information about  
their [] rights in case things go wrong." The OFT took action  
following a similar intervention by the Norwegian Consumer Council.

In the U.S., by contrast, there has been little regulatory attention  
paid to protecting consumers from overreaching TOS agreements. Thanks  
to a history of deference to "freedom of contract" in the U.S., along  
with a dearth of consumer protection laws that apply to online  
services, U.S. consumers often lack adequate protections from unfair  
"terms and conditions."

On this point, a comparison of the new U.K. iTunes TOS ("U.K. Terms")  
and the original U.S. iTunes TOS ("U.S. Terms") on which they were  
based is illuminating. While the majority of the language in the both  
versions is identical, the differences between them are important, and  
illustrate that service providers can make things more fair for  
consumers, if they are forced to do so.

For example, as with many TOS agreements, the iTunes U.S. Terms  
purport to allow Apple to terminate any part of the service, including  
access to any music or other content available through iTunes, at any  
time without warning. The U.K. Terms step back from that extreme  
position. In particular, the U.K. Terms do not allow Apple to affect a  
user's access to content already purchased. Furthermore, before  
terminating a user's access to iTunes, the U.K. Terms require there at  
least be "strong grounds," rather than mere "suspicion," to believe  
the user has violated the agreement, and also obligates iTunes to  
provide notice of any planned modification, suspension, or termination  
to the extent possible. In other words, the U.K. Terms provide  
customers at least some guidance as to the grounds for termination,  
rather than leave them to worry their access to iTunes can be  
terminated at any moment for any reason.

Another area where the new U.K. Terms make progress is in placing  
restrictions on Apple's ability to modify terms for existing  
customers. Many TOS agreements, including the iTunes U.S. Terms, claim  
the right to modify terms unilaterally, at any time, and without  
notice to the customer. It is refreshing to see the U.K. Terms require  
notice of the new terms before they become effective, as well as an  
opportunity to reject the changes without affecting purchases already  
made. The UK approach makes much more sense than the U.S. Terms'  
insistence on allowing Apple to act unilaterally without notice. And  
the fact that Apple can do it for customers in the UK means they can  
and should do it for customers elsewhere.

The new U.K. Terms also depart from the common abusive practice of  
trying to completely insulate the service provider from any and all  
liability to customers whatsoever, regardless of fault. The U.S.  
Terms, for example, include repeated pronouncements that the service  
is not guaranteed to work and that the service provider will not be  
liable for damages caused by defects in the product, use of the  
service, or even by actions taken by the service provider. In  
contrast, the U.K. Terms promise to provide the service "with  
reasonable care and skill." The U.K. Terms also go out of their way to  
say that Apple cannot disclaim liability for fraud or harm that  
results from its own negligence, which seems like common sense. In  
addition, rather than make a broad declaration that Apple can never be  
liable for anything, the U.K. Terms present specific instances where  
Apple will not be liable.

Interestingly, the U.K. Terms and U.S. Terms also appear to take  
different approaches regarding what you get when you buy from the  
iTunes Store. The U.S. Terms repeatedly refer to the acquisition music  
or movies through the store as "purchases." At the same time, however,  
the terms impose on the "purchaser" a set of "Usage Rules"—such as  
deciding how many and what devices the content may play on—that muddy  
the waters about the nature of your ownership. By contrast, the U.K.  
Terms state that the iTunes store provides only a "license for digital  
content." Also, the U.K. Terms tend to emphasize iTunes as a  
"Service," while the U.S. Terms speak in reference to the "Products"  
acquired through it (suggesting that you own your downloads the same  
way you own a music CD).

The pro-consumer elements of the U.K. Terms demonstrate that service  
providers can provide more fairness to customers in their TOS  
agreements without destroying their bottom line. This underscores that  
most overreaching provisions in TOS agreements today are the product,  
not of business necessity, but of overzealous anti-customer lawyering.  
Hopefully, as regulators around the world begin stepping in on behalf  
of consumers, we may start seeing progress toward a more reasonable  
standard TOS agreement.