Microsoft Software for Sale, Slightly Used

Alsee writes "The Register reports that recent UK business Discount-Licensing.com has been having booming growth reselling pre-owned Microsoft software licenses 20-50% below retail, after spotting the opportunity in Microsoft's licensing terms and Britain's insolvency laws for insolvent and downsizing businesses. Sorry, no discount personal OS resales, corporate bulk resales only."

Comments

What a crazy idea!

[IntelliAdmin]

What a crazy idea - the thought that you actually can do what you want with something you purchased. I wonder how long it is before the BSA finds some way of shutting these people down.

Re:What a crazy idea!

[ehrichweiss]

There's really absolutely nothing extraordinary about this at all. At least here in the States, "shrinkwrap licensing" doesn't hold water in the higher courts and the only real way to keep someone from selling their software is by signed agreement.

SGI has for years sold software under a license where you physically sign an agreement to purchase, and the license forbids resale of the software without express permission of Silicon Graphics. The thing is, they have the attitude toward their media that most of us wish that the record/movie companies had toward CD/DVD's..if it gets damaged, lost, stolen, etc. then they replace it for free...usually overnight Fedex. But that was back in the day, I'm unsure if they still do this now.

Anyway, I'm glad to see someone do this with the corporate licenses; it's about damn time.

Re:What a crazy idea!

[Sparr0]

Let me direct you to one of my favorite Sale vs License rulings, Adobe v Softman. Relevant excerpts follow:

A number of courts have held that the sale of software is the sale of a good within the meaning of Uniform Commercial Code. Advent Sys. Ltd. v. Unisys Corp., 925 F.2d 670, 676 (3d Cir. 1991); Step-Saver, 929 F.2d at 99-100; Downriver Internists v. Harris Corp., 929 F.2d 1147, 1150 (6th Cir. 1991). It is well-settled that in determining whether a transaction is a sale, a lease, or a license, courts look to the economic realities of the exchange. ...

Other courts have reached the same conclusion: software is sold and not licensed. See, e.g., RRX Indus., Inc. v. Lab-Con Inc., 772 F.2d 543, 546 (9th Cir. 1985); Applied Info. Mgmt., Inc, v. Icart, 976 Supp. 149, 155 (E.D.N.Y. 1997) finding that whether a transaction denominated a "license" was in act a sale conveying ownership was a disputed question of fact); Novell, Inc. v. CPU Distrib., Inc., 2000 U.S. Dist. Lexis 9975 (S.D. Tex. 2000). In Novell, a software manufacturer was pursuing a discount retailer for copyright infringement. Like Adobe, CPU argued that it purchased the software from an authorized source, and was entitled to resell it under the first sale doctrine. Novell claimed that it did not sell software but merely licensed it to distribution partners. The court held that these transactions constituted sales and not a license, and therefore that the first sale doctrine applied. 2000 U.S. Dist. Lexis 9975 at *18. ...

The Court finds that the circumstances surrounding the transaction strongly suggests that the transaction is in fact a sale rather than a license. For example, the purchaser commonly obtains a single copy of the software, with documentation, for a single price, which the purchaser pays at the time of the transaction, and which constitutes the entire payment for the "license." The license runs for an indefinite term without provisions for renewal. In light of these indicia, many courts and commentators conclude that a "shrinkwrap license" transaction is a sale of goods rather than a license.12 ...

The reality of the business environment also suggests that Adobe sells its software to distributors. Adobe transfers large amounts of merchandise to distributors. The distributors pay full value for the merchandise and accept the risk that the software may be damaged or lost.13 The distributors also accept the risk that they will be unable to resell the product.14 The distributors then resell the product to other distributors in the secondary market. The secondary market and the ultimate consumer also pay full value for the product, and accept the risk that the product may be lost or damaged. This evidence suggests a transfer of title in the good. The transfer of a product for consideration with a transfer of title and risk of loss generally constitutes a sale. VWP of Am., Inc. v. United States, 175 F.3d 1327, 1338-39 (Fed. Cir. 1999). ...

[signed]
DEAN D. PREGERSON
United States District Judge

Re:This probably won't last for very long.

[mjmartin_uk]

Ahhh but you forget that UK law would prohibit this (the forceable non-resale of a licence agreement). In the UK you can legally resell your copy of Windows, with the licence agreement, even if it is an OEM copy and was intended to be used (as Microsoft says) 'only on new computers'.

Re:This probably won't last for very long.

[LewsTherinKinslayer]

Microsoft didn't "lose" any money on this sale, neither did they "make" any money.

You're right, Microsoft didn't lose money per se. However, Microsoft did lose a fairly substantial potential business because of this.

This is similar to me buying the Monopoly(tm) board game at a garage sale. Parker Brothers neither lost nor made any money on the deal.

Perhaps Parker Brothers should put some kind of license agreement in their board games that prohibits resale of Monopoly. This is of course, the move Microsoft is going to be making soon. (And already has, as in the case of OEM licenses.)

Personally I think the idea of a license agreement forcing non-resale is ridiculous. Its similiar to DRM: some company telling me what I can and can't do with something once I've purchased it. Feh.