Rachel Rodriguez – There is a stark difference between physical and digital ownership that many neglect to recognize: each comes with a different “bundle of rights.” The cornerstone of property law is shaped by the right to transfer, to exclude, to use, and to enjoy. Yet, as digital consumerism becomes more standard in our society, it’s becoming increasingly clear that this bundle of rights is changing–or rather, dwindling.
For example, consider a laptop. Whether purchased in person or online, at the end of the day, it is still a physical product. Creating a passcode excludes others from using it. A laptop can also be resold once the owner wipes the data on it clean; and it can certainly be used to fulfill a variety of functions, such as going onto the internet to share thoughts on a blogpost or social media.
Yet even an owner’s right to use can be limited given the reliance of certain apps for business. Microsoft Suite is one such example. Although Apple’s “Pages” can achieve the same result, most of the world uses Microsoft Word for documentation, which requires a subscription. Fortunately, many businesses and schools offer a to use Microsoft Suite as part of their associated email addresses. However, the normalization of such a practice means that, in order to maximize the full use of a nearly $2,000 laptop, it requires buying a license for another product, which reframes the notion of property ownership as it pertains to digital assets.
Licensing is not a new concept; after all, the idea of granting a stranger permission to use property in a certain way is as old as the idea of ownership itself. But over the years, it seems that licensing is the preferable business model for digital assets as opposed to full ownership. The video game industry is notorious for this. Steam Deck, a platform that allows users to buy and play video games, now has a unique disclaimer: the consumer is buying a license to use, not actual ownership over a video game.
This disclosure follows the enactment of AB 2426, which requires digital companies to remind consumers that they are actually buying a license to use a video game, not full ownership of the game itself. This law is especially important considering the fact that many people often disregard a platform’s “Terms & Conditions” when creating an account. This ultimately begs the question: if a consumer pays the full retail price of a video game on Steam, does that mean they have the potential to lose access to it, nonetheless?
And the answer is yes. As this IGN article makes clear, the disclaimer comes from the amount of cases in which many gamers suddenly lost access to the video game properties they bought after a server shutdown. So, what does this do to the bundle of rights attached to ownership?
Well for one, a license means that there is only right available—the right to use. A right that is completely revokable! Given that the prices of video games are rising exponentially, this is a pretty hefty price tag to pay for a mere license to pursue a fun hobby.
Moreover, rights for physical ownership of digital assets are also changing. For example, the Nintendo Switch 2 caused controversy after an update gave power to the company to render consoles “permanently unusable” if consumers violate Nintendo’s Terms & Agreements. Therefore, even though players physically own the console, they no longer have full autonomous control over it.
The reason for this “bricked” screen is simple on its face: Nintendo wants to prevent piracy of video game titles and mods. Yet, the list of restrictions seem to go a bit beyond the mere prevention of illegal activity. Mainly, “tamper with the system or services in any way.” The language in this restriction is simply too vague—does this mean if a consumer takes a broken console to an independent repair store, they would also risk rendering their console “permanently unusable?” Especially since Nintendo has yet to release official repair parts for the Switch, a practice that is considered legal can easily turn into a violation of the company’s Terms & Agreements.
In other words, this is just another license, not full ownership, especially since a Nintendo Switch 2 costs roughly $450. If the consumer pays that much for a physical product in which they have no full control over, then has digital consumerism rendered full ownership obsolete?
After all, the video game industry is just one example. Property rights are evolving across a plethora of industries who are incorporating digital assets into everyday life, such as smart fridges, whose functionality relies on updates, which manufacturers can decide to stop if it is no longer feasible to continue maintenance. Without control, there is no full ownership; thus, all the consumer has is just a very expensive license over a digital asset. The problem does not seem to be going away soon, but there is some hope. Many consumers are opting to go back to buying physical media, a trend that is slowly on the upswing. While most point to nostalgia for simpler times, it could also be a sign that the consumer wants to take back control. Although digital consumerism allows for the consumer to have a wide variety of options and storing capabilities at their disposal, the bundle of rights associated with true ownership is simply too powerful to give up. Hence, despite the allure of digital consumerism, be wary of the convenience of licensing masquerading a true ownership.
