Re: no more free UO

In article <MPG.1e0b97d0c1c433ac98a860@xxxxxxxxxxxxxxxx>, Gerry Quinn wrote:
> In article <Xns972C6398E60F0klaatunospaminvalid@xxxxxxxxx>,
> klaatu@xxxxxxxxxxxxxx says...
>> Yes, and they're also pushing hard, and being pretty successful at it too,
>> the notion that what people are buying is not the software, but a LICENSE
>> to use the software. More bull***. When I buy a game or any other type
>> computer program, I'm buying the software, not some damn license. Not
>> exclusively, of course. Just as when I buy a book, I'm buying a book and
>> not a license for the book's contents, and not exclusive use of the book.
> Like it or not, it's a license you are buying. Try to define your use
> of the word "software" and you'll realise there's no other way to
> define it.

Like it or not, the US courts disagree with you.
Softman v Adobe
(http://cryptome.org/softman-v-adobe.htm)

"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. Microsoft Corp. v. DAK Indus., 66 F.3d 1091 (9th Cir. 1995);
United States v. Wise, 550 F.2d 1180 (9th Cir. 1977). In DAK, Microsoft and
DAK entered into a license agreement granting DAK certain nonexclusive
license rights to Microsoft's computer software. The agreement provided that
DAK would pay a royalty rate per copy of computer software that it
distributed. Subsequently, DAK filed a petition for bankruptcy, and failed
to pay the final two out of a total of five installments. Microsoft filed a
motion for the payment of an administrative expense, claiming that it should
be compensated for DAK's post-bankruptcy petition use of the license
agreement. On appeal, the Ninth Circuit held that the economic realities of
the agreement indicated that it was a sale, not a license to use. Thus,
Microsoft simply held an unsecured claim and not an administrative expense.
The court found that the agreement was best characterized as a lump sum sale
of software units to DAK, rather than a grant of permission to use an
intellectual property. The court in DAK noted:

Because we look to the economic realities of the agreement, the fact that
the agreement labels itself a "license" and calls the payments "royalties,"
both terms that arguably imply periodic payment for the use rather than sale
of technology, does not control our analysis.
DAK, GG F.3d at 1095, n.2. 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.

Adobe frames the issue as a dispute about the ownership of intellectual
property. In fact, it is a dispute about the ownership of individual pieces
of Adobe software. Section 202 of the Copyright Act recognizes a distinction
between tangible property rights in copies of the work and intangible
property rights in the creation itself.11 In this case, no claim is made
that transfer of the copy involves transfer of the ownership of the
intellectual property within. (See SoftMan's Suppl. Brief at 9-10) ("Adobe
has ownership rights in the copyright of [its] software.").) What is at
stake here is the right of the purchaser to dispose of that purchaser's
particular copy of the software.

____________________

11 "Ownership of a copyright, or of any of the exclusive rights under a
copyright, is distinct from ownership of any material object in which the
work is embodied." 17 U.S.C. 202.

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 Court understands fully why licensing has many advantages for software
publishers. However, this preference does not alter the Court's analysis
that the substance of the transaction at issue here is a sale and not a
license. "
.

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