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In AU, Court Rules Downloaded Software Is Not "Goods"
bennyboy64 writes "A court decision ruling that the supply of software through a digital download mechanism is not a supply of 'goods' has been upheld in the Supreme Court of New South Wales in Australia, setting a precedent that software downloaded via the Internet is not protected by the Sale of Goods Act, reports ZDNet. It's a court decision that lawyer Patrick Gunning said attorneys had been waiting to have clarified for some time. What this meant was that 'people who purchase software will have more legal rights if they buy over the counter rather than downloading,' Gunning said."
I suppose that means that they can't be taxed as goods then?
What is their deal? Their motto seems to be "The consumer is always a criminal". It's weird.
Does the "purchase" somehow get "erased" if I download AFTER providing my billing information? Do I get a credit after I pay you and THEN download?
What part of "this makes no sense" does the court not get?
I can understand for the cases of a download of software when no money changes hands (and indeed, this helps those of us who want to provide code free of charge with no warranty attached -- use at you own risk). But, it makes no sense if money has changed hands.
In Liberty, Rene
Software is information—a set of instructions and related data. If pure information is not considered a good in other contexts then it makes sense that software delivered without any physical medium would not be considered a good either. Software purchased "over the counter" is not pure information, however, since you're buying the physical packaging as well as the information content.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
How does this affect downloading software illegally?
If the business is not subject to a contract saying what it's software will have, why should the customer be subject to the same contract about what the do with it?
If the companies are simply providing a service to write arbitrary bytes to a customers' hard drive, not selling a market good, then they shouldn't get copyright protection on those bytes being written either. After all, those bytes aren't a sold good, but are merely a byproduct of the service provided.
Ryan Fenton
"Goods" include all chattels personal other than things in action and money. The term includes emblements and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale.
Acquired from the definitions page of the Sales of Goods Act 1923.
Jhyrryl
It's not a good, it's a service. Like a song played over the radio isn't a good, it's a service, while a song bought on a CD is a good. The judge recognized that his ruling could lead to injustice, and called on parliament to change the law to reflect the changes in the definition of 'goods' that the digital revolution has brought about.
- None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
Before you all throw full bottles of beer at your computer screen, let me remind you of a post I made earlier today. About Valve and their steamworks software. Since they are not selling the goods, they are "Licensing" it out to you. This does mean you do not have certain rights to the product, but it also means you have certain other rights. For example, you won't have to pay Taxes. (and I've never paid taxes on any Steam Games).
So, yes, unless they are taxing you on some service, then you shouldn't be taxed at all. So make sure you read the fine print for some "Supplier services fee".
Just sayin'.
In the case of downloaded software, not only is most of clearly not "goods", a great deal of it must be characterized as "terribles".
Welcome to the Panopticon. Used to be a prison, now it's your home.
Seems to me this would open the door to selling something like a PS3, simply hardware, and offer a code to download the OS. The hardware itself does nothing except allow you to open a connection to download the OS at first run. This way if the hardware fails, sure they can return it. But the software you're stuck with.
All the EULAs I've read in the past 30 years say that you're not buying the software, you're licensing the use of a copy of the software.
Weird that it's getting twisted like this, but I've been surprised by Australian law before.
We get a certain protection for purchasing goods from some distributers, would this no longer apply to an item newly classified as a "non-good"?
Well, other than the fact that a PS3 isn't completely blank out of the box, that's precisely how a PS3 works. You bought the hardware. You license the software, and SCE can (and will) change it any time they want--because it's still their software. The recent "Other OS" debacle is the logical extreme of the "software as service" approach, as well as the typical disclaimers of warranty you've seen in EULAs (not that those would fare so well in court, IMHO... the serviceability and suitability for purposes of use of the hardware being completely dependent on the software, after all.)
Welcome to the Panopticon. Used to be a prison, now it's your home.
they shouldn't be taxed as goods then.
The Kruger Dunning explains most post on
I fully agree with that. Most songs played over the radio are no good at all.
I think this just means that you can't resell your software-licenses AS LONG as you didn't buy a physical storage device...
The MAFIAA is a bunch of mindless jerks who will be the first up against the wall when the revolution comes
This is a no brainer really. Take delivery of the software on a CDROM or such. Its a bit of a shitter that this dude has been left out of pocket, but his case will serve as a lesson to other businesses - its not that much more to get a CDROM shipped, and for joe consumer, as I understand it, the law is changing.
Got a phone call from the Illinois Dept. of Revenue wondering why we hadn't paid sales tax. Well, it's because our software is opensource. We don't see it, we sell installation, implementation, and support contracts. The guy on the other end of the phone could not get it through his head until I explained: 6% of $0.00 = $0.00.
"The problem with socialism is eventually you run out of other people's money" - Thatcher.
It's important to remember this is only applicable to one Australian State, New South Wales, and is not National.
This is why copyright law exists, people have explicitly understood for quite a long time that copying specific expresion of ideas is not theft since no actual goods have changed hands.
Still good that the clarification is made though.
Technically in Australia it's illegal to import into the country anything that has been refused classification - the situation with our backward laws regarding the lack of an 18+ game rating is well-known. It's legal to possess the material, but technically bringing them into the country is an offense.
However if downloaded material is not 'goods' then do import restrictions apply? Customs & import laws are only applied to goods, after all.
That seems quite logical and, consequently, should drive people to buying over the counter.
Or negotiate and demand same rights for the downloaded software in the EULA (or something) and do not buy downloads without those same right granted "in writing".
hany
Probably too late to this discussion, but what the heck.
I think big media needs to be forced to make a choice between:
1) Physical media, first sale applies. It is not a "license", it is a genuine copy and you can do whatever you want with it apart from making it available for others to download.
2) Digital media, first sale does not apply. However, it is a license subject to the laws of [insert country]. One mandatory feature is free or very cheap redownloadability. A second mandatory feature is 3 free copies for personal use (iPod, computer, and offline back-up).
They can't have their cake and eat it, too. If they are going to eliminate first sale, they should be forced to allow you to redownload stuff since you have a permanent license to XYZ song/movie/whatever. So, they can't make you buy it again and again and again (vinyl, 8-track, cassette, CD, etc.). Same rationale for the 3 copies. You can't resell your license so they have a higher burden.
What do you think?
-l
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