Last week’s Windows Secrets newsletter featured a story by Scott Dunn about Ed Foster’s crusade against bad End User License Agreements (EULAs). EULAs have been the bane of the existence of computer users for decades – at least, those who even bother to read them or acknowledge their existence.
The EULA has been held up as a binding legal contract between the software vendor and the end user (the person who purchases, installs and/or uses the software). However, EULAs differ from traditional contracts in several ways. Perhaps most importantly, there is (currently, at least) no formal signature proving that a specific person entered into this agreement. Although verbal contracts have long been considered valid by the courts in some circumstances, a key element of enforcing a contract is proving that the parties actually made the agreement in the first place – and without undue duress or trickery.
In almost all cases of consumer software, EULAs are “signed” by clicking a button that says “I agree.” There’s no way to prove later, however, who clicked that button, which could (or at least should) make it problematic to enforce the terms of the EULA against a specific user. At some time in the future, all computer users may be required to obtain digital signatures, which use certificates issued by certification authorities verifying a person’s identity. Digital signatures may one day be required to send email and other electronic communications, as well as to sign electronic contracts. But at the moment, software companies have no way to determine who accepted the contract.
Another difference between EULAs and contracts for, say, buying a new car, is that with traditional contracts you get to read and sign the contract before you part with your money for the product or service. Software EULAs are typically displayed for “signing” after you’ve plopped down the cash (or charged your credit card). In the case of boxed software, you do get a printed copy of the EULA but it’s inside the box; you don’t see it until after you’ve spent the dough and taken it home. In the Internet age, this problem has been ameliorated somewhat by the ability of vendors to post their EULAs on the web so you can check it out before you buy – if you have Internet access. For example, you can go to this website to find the license terms for most Microsoft products. Still, few folks read the contract before (or even after) purchasing the software.
The EULA usually defines what you can do with the software; for instance, that you can only install and use it on one machine at a time. That may be reasonable to protect the software vendor from piracy, but the trouble is, EULAs are getting more and more restrictive all the time. Some EULAs now contain language that could prohibit you from installing the software on a second machine even if the original computer on which you installed it died and is no longer usable. And that’s not reasonable. That’s like saying that if I buy a very cool and expensive stereo system for my car and then I get a new car, I can’t take the stereo out and put it in the new car.
Another big gripe of computer users is that EULAs routinely disclaim all express and implied warranties. In other words, the contract you “sign” agrees that the software doesn’t have to work as advertised, or even work at all. And even if an acknowledged programming error causes you to lose important data or the use of your computer for days, the software vendor has no responsibility. In the case of buying software, the rule really is “buyer beware” and “proceed at your own risk.” In fact, with such leeway, it’s amazing that vendors make their software work as well as it does. Imagine signing a contract with an appliance vendor that says, in essence, the refrigerator you bought might or might not cool your food and if it doesn’t, not only are you not entitled to any compensation for your spoiled food but you also don’t get back the several hundred or several thousand dollars you paid for the refrigerator.
How did EULAs come about in the first place? Well, according to the 3rd Circuit federal court in a case styled Step-Saver Data Systems Inc. vs. Wyse Technology way back in 1991, software licenses (EULAs) were first developed in large part to avoid the federal copyright law first sale doctrine. The first sale doctrine is part of the U.S. copyright law that says a purchaser can transfer a legally made copy of a protected work without permission. The EULA is basically an attempt to get you to contractually waive that right.
Court cases regarding the enforceability of EULAs have been mixed since then. Some courts have found so-called shrinkwrap license agreements (those enclosed in a software package and inaccessible until after you buy the software) to be invalid. The clickable agreements have been given more weight by most courts.
When I wrote about EULAs here a few years ago, I was much less bothered by them than I am now. I find the trend to include more and more restrictions on what users can do with the software they pay for to be disturbing. Some license agreements now prohibit users from releasing or publishing information about the performance of the software. That effectively prevents reviewers such as myself from reporting to readers our experiences with a particular piece of software. I think that’s going too far.
Much as I like Vista, I don’t like the fact that its EULA gives Microsoft the right to validate your software at any time (that is, check to verify that the software has been activated and is licensed) and disable some of its features if it can’t be validated. And as a technology writer who uses virtual machines for testing and screenshots, I’m not happy about the clause that prohibits installing Vista Home Basic and Premium in VMs.
I recognize the need for EULAs, but it seems software vendors are taking advantage of the privilege. It’s the old “give ’em an inch and they’ll take a mile” problem. What do you think? Should you have to “sign” an agreement to use software? If so, what terms are reasonable and which ones aren’t? Should you be able to get a refund if you get home, read the EULA and don’t like it? (Microsoft provides for that, but some vendors don’t). Are there certain clauses that vendors should not be allowed to include in EULAs? Or am I just complaining about nothing?