At 02:32 PM 8/3/2002 -0400, Bagotronix Tech Support wrote:
>I have been warning friends and family about
>what is happening with software licensing, with mixed results.  I get a lot
>of apathy.  It will be that way until one day they turn on their PC and it
>says (names changed to protect the guilty):
>
>"Your Winblows license has expired.  For your convenience, we have your
>credit card information on file.  So that we may continue to serve you,
>please click on 'OK' to renew your Winblows license.  Your credit card will
>then be charged $199 for a one-year license renewal.  If you click on
>'cancel', you will be charged a one-time fee of $99 to cover processing
>costs of removing your computer information from the central license
>registration database.  Should you decide to renew later, you will be
>charged an addtional $99 processing fee to add your computer information
>back to the central license registration database, in additon to the rate
>for a new license, which is currently $299.

The scenario is not entirely ridiculous, though the numbers are likely 
inflated over what they would actually be at current pricing. The 
cancellation fee is unlikely, but if it was clearly stated in the user 
agreement, accepted at installation, it might be legally enforceable. 
However, the scenario goes beyond what would be lawfully enforceable in 
today's world:

>   Should you desire to contest
>these charges, please recall in the End User's License Agreement that by
>using the software, you agreed to not use credit card chargeback procedures.

This would almost certainly be a violation of credit card company policy. 
In other words, the credit card companies would ignore it and would still 
honor a protest and chargeback if they determined the charge to be 
illegitimate. Having a little experience with chargebacks, I'd say that the 
credit card companies tend to give priority to customer claims; if the 
customer claim is reasonable on the face, they will give the charging 
company an opportunity to rebut; but they don't want to be courts, there is 
no money in it for them. The cardholder is their customer, they want to 
keep him or her happy; and if they don't honor a reasonable chargeback, 
their customer could, in fact, refuse to pay the bill and that, in itself, 
will create more headache than they want.

(If you refuse to pay a charge on a credit card bill, they *must* follow a 
procedure prescribed by law; if they don't, not only will you not be 
required to pay the charge, they will be assessed penalties which, if there 
is still a balance, you can deduct from the balance. I ended up in a 
dispute with Capital One over some overlimit and interest charges they had 
assessed because they failed to credit an account timely with a payment; 
fortunately, I had sent the payment return receipt requested, so I knew 
when they had received it. It did take a few months and a few layers of 
management, but they ended up crediting me with the whole shebang, 
reversing their charges and in addition, the penalty prescribed by law.)

So Microsoft would have to go to court to collect. They might succeed if 
the user contract was reasonable, i.e., there was a discount given at time 
of purchase which could be recaptured if a customer did not complete a 
contract period, but a contract that locks in a customer to payments over, 
basically, the rest of their life would probably not be enforceable under 
the statute of frauds (which makes contracts to be performed over a period 
longer than one year unenforceable unless they are in writing). And 
Microsoft would definitely not want to be seen in court with customers over 
a matter like this!

It's easy to cancel a credit card!

>Should you attempt to reclaim files from this computer's hard disk without
>first renewing your Winblows license, any .NYET-enabled files will report
>their being opened to the central license registration database, possibly
>leading to your prosecution under the Digital Millenium Copyright Act for
>felony charges of attempting to defeat software security measures.   Thank
>you for using Macrohard products."
>
>OK, that was not a statement of fact, but a prediction of how it might go.
>In any case, it was fun to write.  And it (or something like it) COULD
>happen.

Well, some aspects are possible, but quite unlikely. Such practices would 
have to be clear in the user agreement, and, if as extensive as was 
described, would also have to be in writing; even then they could be 
cancelled (stringent contracts written by the seller to the buyers 
detriment might not be enforceable even if the buyer has signed). And as 
soon as it was widely realized that a user agreement contained such 
provisions, their sales would go to close to zero.

Files can't report being opened (unless they are executable), rather an 
operating system could make such a report that the file was opened. And 
this would be a tad difficult if the network was unplugged. And I think it 
would be a bit difficult to enforce the DCMA against a user attempting to 
recover his own data, that was definitely not the purpose of the DCMA. Who 
would be the injured party? Defeating the encryption of copyrighted 
material involves an injured party, the holder of the copyright 
(ostensibly; I don't necessarily agree, but the law provides a presumption 
of that), but defeating the encryption of one's own data, not copyrighted 
by anyone else, no, I highly doubt that this would be illegal in the 
forseeable future.

I don't like the XP licensing scheme and it is the major reason I have not 
purchased XP. If XP became necessary for some reason, however, I don't 
think it would stop me from going ahead (although I could change my mind 
after reading the user agreement). Upshot is that I suspect that the new 
licensing system is hurting XP sales and only the OEM agreements are saving 
Microsoft's skin. I have previously commented on this list and elsewhere 
that a certain level of copyright violation (i.e., copying or using without 
license) may actually *help* the copyright owner by stimulating sales in 
the long run, I'm almost certain this is true for software, provided that 
such copying does not become the norm.

Here, with ATS, it seems completely within Altium's rights to set up such a 
maintenance system. They have not attempted to make maintenance obligatory, 
which would be offensive. (I don't know if it still does, but the PADS user 
agreement provided for repossession of the software if maintenance was not 
paid. When I asked them about it, they said, "Oh, we don't enforce that." 
But they could at any time. They lost a sale because of that clause, and 
they probably would have lost more than they do if users carefully read the 
agreements.)

The argument that Altium is required to provide fixes for all bugs without 
charge is seriously defective. It is good business for Altium to provide a 
certain level of maintenance without charge. If a bug makes the program 
unusable for a customer, the customer might be able to demand a refund; 
specific performance (i.e., a legal requirement that a person perform as 
required by contract) is not even an issue unless Altium had contracted to 
provide such fixes. Otherwise, the burden is on the customer to determine 
if the product meets his or her needs. If it does not, the customer really 
has only one recourse: return the software for refund. If Altium refused to 
refund, the customer might have a cause of action to sue for the refund. 
But I suspect that a non-frivolous claim of unusability would be honored by 
Altium. If one had kept the software for a year before returning it, I 
doubt that such a claim would be honored, however.

So Altium, by providing ATS for a year, is really protecting itself against 
claims of unusability.

Basically, if I have a tool I want to sell, that tool may do some things 
well and it may do other things poorly. It may have design flaws. If it 
were a requirement of law that the seller were required to provide 
replacements of the tool to fix every defect or design flaw, for an 
indefinite period of time, well, let's say that I'd go into a different 
business than selling tools.... Warranties only extend, typically, for a 
fixed period of time. And warranties typically do not cover design 
deficiencies if the product can be used for its intended purpose.

Protel 99SE, quite clearly, can be used for (most) of its intended 
purposes. If the 3-D viever is a nearly useless toy, well, we could have 
returned the program (or the upgrade) soon after we received it. If we 
didn't, quite likely we kept the program because we could use it 
sufficiently that it was worth what we paid for it.

It is perfectly legitimate to sit back and wait to see how DXP goes. Altium 
is not threatening users that they will suffer by waiting, anything more 
than not being able to use the new version while they waid (except for the 
demo). I'd certainly advise getting the demo and perhaps waiting to install 
it until one is close to making a decision (or until one has some spare 
time). My sense from DXP users is that the upgrade is worth the price, but 
there are still 2.8 users out there, even though I'm certain that what it 
took to get from 2.8 to 99SE (not much, really) was well worth it, *if* one 
is doing design regularly. Not everyone is.

I would, however, watch Altium for changes to upgrade pricing. Sometimes 
they make special offers, sometimes they raise prices, usually with some 
advance notice. I waited to do the P99 upgrade until the $700 special 
offer, so I saved $300. But because of that, I didn't start to use P99 for 
perhaps three months or more. Overall I think I would have been better off 
buying it sooner.

Much or most of the cost of upgrading is really retraining, BTW. Even if 
Alium gave away the upgrade, this cost would remain. (I don't think the 
retraining for DXP is severe, but it *is* different, as we have seen from 
complaints here.)

$2K for an upgrade from 99SE to DXP seems reasonable to me; it is a little 
more than I expected, but not a lot more. ATS -- am I right? -- is $1500 
per year, which is also a tad high, but, again, not a lot higher than 
expected. As long as the software works (not necessarily perfectly), ATS is 
voluntary, and is included with purchase for a year, it seems a reasonable 
method for providing maintenance and upgrade as an alternative to the 
upgrade purchase method Protel used in the past. I'm assuming that service 
will improve with the improved cash flow, the new DXP tech support list is 
a good indication that this is, in fact, happening. (I also see Mr. 
Shwaiger frequently on that list, I don't know his position now, but he was 
the Protel Engineering Manager at one time, he might still be. 
Communication with users is improving, a very good step toward better service.)


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