FTC-Sony Settlement Sets a Good Precedent
February 28, 2007
Filed under Digital Copyright
Earlier today we filed comments with the Federal Trade Commission praising its recent settlement with Sony BMG Music Entertainment over the 2005 "rootkit" debacle. As you may recall, in 2005, Sony BMG shipped a number of compact discs that included a new form of digital rights management (DRM) technology. When consumers attempted to play the discs on their computers, the DRM surreptitiously installed "rootkit" software. The DRM was designed to function in the background, where it was invisible to the average user. The DRM not only allowed Sony to monitor its customers' activities -- by opening the door to that surveillance, it also exposed affected computers to serious security threats. As we point out in both our official comments and our press release, the settlement reaffirms core consumer rights in three key provisions:
- The first was that Sony BMG must clearly disclose the presence of DRM software and obtain affirmative consumer consent before installing the software. This requirement promotes the principle that consumers -- not software distributors -- should be in control of which applications are installed on their computers.
- Second, the FTC has required Sony BMG to obtain affirmative consumer consent prior to transmitting information about consumers, their computers, or their use of content back to Sony BMG servers. Importantly, the settlement says that these disclosures must be "unavoidable." To us this would appear to mean that such disclosures should not be buried in end user license agreements (EULAS). This requirement reflects the fact that this kind of information transfer is a significant event from the consumer perspective, and that consumers deserve to be informed and given a choice about the collection and use of this information.
- Finally, the FTC has continued to promote the best practice of requiring software distributors to provide a reasonable and effective mechanism for consumers to uninstall their software.