Taipei Orders Google & Apple To Offer 7-Day Free Trials Of All Apps Offered Via App Markets

from the liability-confusion dept

Tue, Jun 7th 2011 10:33am — Mike Masnick

Apparently some regulators in Taiwan's capital city of Taipei have extended some consumer protection laws such that they've ordered Google and Apple to start providing 7-day free trials of every app, in either the Apple App Store or the Google Android Marketplace, or face large fines. The issue is that the consumer protection laws require a grace period for returns, which neither of these services provide to the extent that Taipei regulators would like. Apple and Google, quite reasonably, point out that they should not be liable as third parties, suggesting (implicitly) that it should be developers themselves who are responsible for obeying any sort of consumer protection regulations. However, Taipei regulators aren't buying it:

"Such a claim is an irresponsible business practice," Yeh said.

The two companies have been given 15 days to comply with the law, and if they are unable to do so, they could be facing significant fines. It does make me wonder if either company even has the functionality to offer such things across the board, and how various developers would feel about that.

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Filed Under: apps, free, taipei
Companies: apple, google

34 Comments

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Lisa Westveld (profile), 7 Jun 2011 @ 10:16am

Or, maybe they choose an easier solution...
They could, of course, close their official sales channels in Taiwan. Then you can't buy these apps directly in Taiwan, although they could still be purchased abroad. And with the Internet, borders are mostly non-existent...
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william (profile), 7 Jun 2011 @ 10:50am

as far as I know, iTunes does NOT have this functionality.

The closes thing they have are preview codes issues to reviewers, and those are limited to 50 codes per version of the software I believe.

So yeah, it's quite irresponsible to say that it's not their problem while their platform does not offer this kind of function.

Especially for Apple, since there is only ONE store. Android on the other hand can use different markets. I am kind of wondering if you can actually create a separate, non-official market to handle this
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John Doe, 7 Jun 2011 @ 10:50am

Google = $$$ Grab
It seems that many countries now days see Google or any other tech giant (usually a US tech giant) as a way to make easy money. The thing is, does Google even have a presence there? If not, who is going to actually force them to pay fines?

It is time the US government steps up and swats down stuff like this. Heck, if they are willing to send up the missile on hackers then surely they can stand behind our companies and protect them from this kind of money grab.
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sheenyglass (profile), 7 Jun 2011 @ 10:53am

Third party argument not persuasive
If apple and google get a cut of the price for paid apps and exercise control of the market, I don't find the third party argument convincing. If they profit from each sale, their function is analagous to a consignment retailer and, accordingly, they share an obligation to comply with the consumer protection laws.
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DannyB (profile), 7 Jun 2011 @ 10:57am

Re:
Amazon has an Android App store.

Rumors are that Best Buy will open one.

There are also other less well known sites to obtain Android apps.

So I would say that anyone willing to build an app store could create a market to handle this.
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DannyB (profile), 7 Jun 2011 @ 10:59am

Re:
Amazon's app store for Android doesn't work exactly like Google's.

To build an app store, build:
1. An Android app that runs on the device, which offers the store functionality on the device.
2. The actual app store on the Internet which the App interacts with.
Item 2 can also provide a web browser interface to shop and purchase apps.

If you build an app store, you could build it with whatever interface and store policies you wanted.

That does not mean it is easy for either Google or Apple to make changes on 15 days notice.
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Scote, 7 Jun 2011 @ 11:05am

Apple isn't an uninvolved 3'd Party
"Apple and Google, quite reasonably, point out that they should not be liable as third parties,"

Only apps that are are individually approved by Apple are sold in the App store. Apple receives a non-negotiable 30% for every app sold. Apple is not a disinterested 3d party. It sets the rules for all apps.

If apple wants the advantages of forcing all apps into a walled garden then the also have to be responsible for the downside, like being responsible for the TOS.
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DannyB (profile), 7 Jun 2011 @ 11:06am

I'm not so sure this is a bad thing
Google's app store once offered a longer trial period. I think 24 hours. Now it is 15 minutes.

I think 15 minutes is unfair.
I think 24 hours was fair.

I think 7 days may be too long.

One loophole this opens is that you can "borrow" an app as long as you return it within the trial period.

While I'm generally positive about Google, I would like to see them forced to offer a longer than 15 minute trial period. I can't say that I'm completely unhappy about this.
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ClarkeyBalboa (profile), 7 Jun 2011 @ 11:08am

Re: Google = $$$ Grab
In this case though, i'd say it's less of a cash grab, and more of an easy target for who to prosecute. Two companies, or potentially hundreds or thousands of companies?

Either way, i don't think Apple or Google should be the only ones being held accountable.
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Mark Murphy (profile), 7 Jun 2011 @ 11:10am

Android Market: Definitely Possible
The Android Market used to have a 48-hour refund period. They changed that policy to be a 15-minute refund period. The complaints were from developers creating apps whose value might be consumed in that 48-hour window (e.g., games with only a few levels). Hence, technically, Google could require a 7-day refund period, across the board, or perhaps only for app sold in Taiwan (though probably not only Taipei).

Google has no ability to enforce these terms on any other distribution channel, and developers in the Android Market itself have limited ability to offer longer refund periods themselves (per Google's apparent argument).

However, Taipei's 15-day demand means that paid apps will probably be pulled from Taiwan, at least for a while, as these sorts of changes aren't going to be implemented quite that quickly.
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Designerfx (profile), 7 Jun 2011 @ 11:13am

this isn't third party, mike
This is first party. It is google's decision to set the return period on an app. They have changed it more than once, and lowered it to a completely ridiculous 15 minutes.

http://code.google.com/p/android/issues/detail?id=13116

So I think any company that opens an app market should be the focus for this issue, amazon as well.
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Anonymous Coward, 7 Jun 2011 @ 11:16am

Generally, it is the retailer that is responsible for complying with these kind of consumer protection laws, not the manufacturer. Google & Apple therefore are not "third parties."
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taoareyou, 7 Jun 2011 @ 11:26am

Might Improve Quality of Apps
There are a ton of 2.99 to 0.99 apps on the Apple App store that can be completely used up in a week. Games that could be beaten with little replay value, tons of gimmick apps whose novelty wears off within a few days, and many, many more. Seven days free of every app out there would certainly cause many apps to lose sales.

But if that is restricted and only offered to Taiwan, how much would that really hurt the sales globally, where 7 day previews will not be offered?
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David Good (profile), 7 Jun 2011 @ 11:31am

Bye bye Taiwan
I'm thinking this will result in a few things.

1. Apple and Google will close online marketplaces from being available in Taiwan.

2. A seperate store will be opened that will have a smaller selections of apps that can have trial versions implemented, a subset of what is available on the full store.

3. Public outcry will reverse the ruling altogether.
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Chronno S. Trigger (profile), 7 Jun 2011 @ 11:53am

Re: Third party argument not persuasive
But, just like Best Buy isn't responsible for the "Hot Coffee" incident, Google isn't responsible if LogMeIn doesn't want to offer a trial.

While I agree that a free trial should be offered, I don't think it should be legally mandated, or that it's the resellers responsibility to create one.
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AudibleNod (profile), 7 Jun 2011 @ 11:53am

Brick and mortar
If I want to return shirt I bought from Sears, I don't go the shirt maker, I go back to Sears. I understand Taiwan's point. I think there can be other mechanisms in place, however. I think a return policy similar to physical stores can be worked on.
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ChurchHatesTucker (profile), 7 Jun 2011 @ 11:54am

Re: Or, maybe they choose an easier solution...
What worries me is if they do implement this and roll it out worldwide as a 'feature.' The trouble being, they would have to ensure the ability to remotely wipe applications in order to ensure the 'return.' I can do without that functionality, thankyouverymuch.
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Chronno S. Trigger (profile), 7 Jun 2011 @ 11:57am

Re: this isn't third party, mike
This isn't about requiring Google to offer a refund period, it's about forcing Google to offer a 7 day trial. It makes sense to have a refund period, it doesn't make sense to have a trial period.
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ltlw0lf (profile), 7 Jun 2011 @ 12:19pm

Re: I'm not so sure this is a bad thing
One loophole this opens is that you can "borrow" an app as long as you return it within the trial period.

In the real world, this happens quite often. Ever check out an electronics store right after a superbowl or some other sporting event?

A lot of people "borrow" equipment. If companies in the real world don't like this, they model their policies to avoid this (not allowing returns after major sporting events for non-broken equipment, or charging a restocking fee.) It is about time that the mythical world of Intellectual Property was brought more in line with Capitalism.

I am personally tired of buying software only to find out that it doesn't offer what I want or doesn't match what the box said it would do...which is why I rarely buy commercial software any more. With Open Source, Shareware, etc., I can try the software before I buy it, or choose to support the Open Source community behind the software in the case of Open Source. Especially since you can't return commercial software, even if it doesn't match your expectations or doesn't even work (in the case of DRM, I have quite a few programs I bought which I cannot use and cannot return.)
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Dan (profile), 7 Jun 2011 @ 12:20pm

Re: Brick and mortar
I agree with you. We have the option to return physical goods, why not digital? If we had a return option, makers would put more effort into making a good, and useful/entertaining product.
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CommonSense (profile), 7 Jun 2011 @ 12:37pm

Re: Google = $$$ Grab
Except that if the U.S. Government steps in to swat this down, they won't be able to act all 'high and mighty' when the foreign country tries to swat down some unreasonable U.S. policy that the gov't wants enforced. It would look like the U.S. government only cares about policy when it's the U.S. government's policy to begin with............which may only mean finally showing true colors...
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Chronno S. Trigger (profile), 7 Jun 2011 @ 12:41pm

Re: Re: Brick and mortar
Is Sears legally required to take back the shirt? No they're not, and that's where I have a problem. A return policy is great, it shows you have confidence in your product, but it should not be legally required.

Plus, Taipei isn't talking about a simple return policy, they're talking about a 7 day trial. A return policy means that money passes hands, a trial does not. A return policy is in the hands of the reseller, a trial is in the hands of the manufacturer (who has to make a new version with added code to run as a trial).
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Overcast (profile), 7 Jun 2011 @ 1:02pm

Why do they even do business in some of these backwater places?
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sheenyglass (profile), 7 Jun 2011 @ 1:15pm

Re: Re: Third party argument not persuasive
I am agnostic on whether legally mandating the return period is a good policy. However if it is the law of Taiwan I fail to see why the onus for compliance falls on the developer alone.

If sellers of consumer goods in the US were mandated to accept returns for seven days regardless of their fault, Best Buy would have to accept returns of the game for seven days regardless of whether it was at fault. Maybe that would be a bad law, but it would be silly for Best Buy to argue that it shouldn't have to comply because other parties could also offer a refund.

Presumably, Best Buy would have contractual rights to be reimbursed by the distributor in a case like that, just like Google/Apple can retain the right to hold the developers' money until the app clears the seven day period.
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Keroberos (profile), 7 Jun 2011 @ 1:24pm

Re: Re: Re: Brick and mortar
It seems to me their mandating a 7 day free trial to make it easier for app Stores to comply with existing consumer protection laws.

In fact it creates a loophole that app stores can use to bypass the mandated 7 day return for full refund policy.

It wold be fairly simple to change your store's dev policy to state that all apps require a 7 day free trial version. it would be a programing nightmare to have to change the program code for your entire store to allow for a return for a full refund within 7 days just for one country.

Plus trial versions of all apps would benefit consumers everywhere, I personally won't purchase software that does not have a fairly functional trial version.
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Lawrence D'Oliveiro, 7 Jun 2011 @ 5:36pm

Re: Backwater Places??
Taiwan is where most of the world�s high-tech hardware comes from.
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Anonymous Coward, 7 Jun 2011 @ 6:36pm

"Apple and Google, quite reasonably, point out that they should not be liable as third parties, suggesting (implicitly) that it should be developers themselves who are responsible for obeying any sort of consumer protection regulations."

Reasonable? So if you buy a bad can of beans from Wal-Mart, do you go back to the manufacturer or Wal-Mart for a return? By this standard, Wal-Mart takes no liability, you should return that can of beans to the manufacturer.

In essence, Google and Apple are functioning as a sort of hypermart/departmental store; they do have to take some responsiblity.
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Anonymous Coward, 8 Jun 2011 @ 5:57am

People who compare app stores to retail chains are really only showing their ignorance of how applications work.

It's more comparable to your ISP and a website. You wouldn't go to the ISP and say "Hey, all these websites with software you give users access to? Yeah, they have to have 7 day trials now. Or we'll fine you" Sure, you had to pay the ISP to get access to the software. But it makes no sense to hold them accountable for the actual code.
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ltlw0lf (profile), 8 Jun 2011 @ 9:30am

Re:
People who compare app stores to retail chains are really only showing their ignorance of how applications work.

People who believe that app stores and retail chains are different are only showing their ignorance of how capitalism works.

At least it would be true if we got rid of anti-capitalist, government mandated monopolies of an infinite length and shifted so far to the right that the customer is always getting screwed. Or at least curtail them to the point to bring them in-line with the true ideals of a capitalist/consumerist society, where a customer can have some level of recourse to the current "bait-and-switch" model we have now. A company can lie all they want on the brocheur, but the moment the customer (sucker) buys, they have little if any recourse to return the product if it doesn't match the literature.

And as for your analogy...this is already done, for the most part, by ASPs. My ASP gave me thirty days to try out their service, providing me with a dedicated virtual machine to play with for 30 days before they started charging me for the service. So, analogy fail if you are trying to show that an application can't do it because ISPs don't do it, because I am hard pressed to find one now-a-days that doesn't.
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John85851 (profile), 8 Jun 2011 @ 2:04pm

Re: Re: Brick and mortar
Think about your analogy for a minute. With physical goods, there's a physical good (duh) that passes hands and can be returned. When you return an item, you give back the item and the store gives you back your money.
When dealing with digital goods, there's nothing to return: you can't give back a song you downloaded from iTunes. So if Apple decides to give you a refund, you now have the song AND your money.
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Bryan O'Doyle, 8 Jun 2011 @ 2:30pm

If somebody in Taiwan wants to get outfits like Google the Hell out of their market, why not just mandate that the board of directors members have to sign an affidavit clarifying whether or not they have quit beating their mother yet?
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Bryan O'Doyle, 8 Jun 2011 @ 2:32pm

Yea Yeh Yeah!
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faceless (profile), 9 Jun 2011 @ 12:41pm

this is a big problem when trying to apply rules for physical goods onto virtual items
the thing is, people EXPECT to be able to return something for a refund if it doesn't work as advertised. now, seven days is a very long time, but it's much more agreeable than fifteen minutes or one day. ideally, everything should have a demo or trial version, but many things digital may just not be able to stand on their own at a price when their trial or demo is good enough and there aren't enough differences between it and the paid version. there is no simple solution, but a simple solution is what people want. honestly, stores with physical goods have to put up with much more when it comes to returns. they have to restock or sell as open box or in some cases send the item back to the manufacturer for repackaging. with digital goods, there is an infinite supply, so when a developer is against trials or refunds, it looks like money hoarding or a vote of no confidence in their products.
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Ingjald, 13 Jun 2011 @ 10:41pm

Re: Re: Re: Brick and mortar
John85851, Android already has a 15-minute refund window, where you uninstall and delete the app to get your money back. Android most certainly can facilitate refunds that involve returning the goods, though there's nothing preventing you from making a copy before you get your refund. This is no different from many physical goods, though, like books and CDs, which can also be copied before being returned (though sometimes exchange only for CDs).

The real problem is that 7 days is too long a return period for something as small and often fleeting as a smartphone app, where it's often used to death in the first few days and then forgotten. Such a long return policy would likely discourage developers. I think the best solution would be to go back to the old 24-hour return policy that Android used to have (and force Apple to do it too)--that's a good balance between the buyer not getting screwed by a bad app and the developer not getting screwed by "Super Bowl Sunday TV buyers".
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