Friday Frivolity: Of Mice and Relational Contracts

I have posted before about my admiration for the podcaster Alex Goldman and his current venture Hyperfixed. But today I would like to register a complaint about the latest episode, which is about the Internet of Things. My criticisms of the episode are really just a sidebar. I enjoyed the episode while gnashing my teeth a bit over a missed contracts angle.

The episode centers on the experience of a journalist named David. David distrusts bluetooth and seems generally to want his purchases to be, as Erica Jong put it, zipless. He bought a wired mouse because he liked its ergonomics, and he was able to program the buttons with his preferred shortcuts. And then, after three years of use, as he was approaching a writing deadline, the mouse died. David found this maddening, because the mouse hardware seemed fully functional. The problem seemed to be technological, and he had specifically chosen a wired mouse to avoid dependency on software controlled by third parties.

It turned out that the mouse died because the manufacturer failed to update a certificate. Without that certificate, the operating system of David’s computer did not trust the mouse and so refused to communicate with it. Actually, as it turns out, David would have been fine, had he not programmed the buttons on this mouse. Once he did so, he accessed software programs tied to the certificate.

The manufacturer quickly addressed the problem, and within days the mouse was working again, but David was still irked. On the podcast, he says something like (I don’t have a transcript), “When I bought this mouse, I didn’t think I was entering into a long-term relationship with the seller.” He complained, with something like incredulity, that if he bought something that could just shut off because of something the seller neglected to do three years later, was it ever really his property?

Harumph. I don’t know much about property law, but I know that property is a bundle of rights, and not every piece of property comes unencumbered. You can be missing some things from the bundle and still own the thing. So, hell yeah, you own the mouse even if your enjoyment of it may depend on continued support of the underlying technology from the manufacturer. The manufacturer’s commitment to provide continued support for the hardware ought to be (but is not always) factored into the sale price. More on that in a bit.

My face-palming moment came with the first quasi-quotation provided above. David did not want a relationship with the seller when he bought the mouse? Didn’t he want a warranty? David seems to want a simultaneous exchange, which is no contract at all. Contracts entail forward-going promises, and David is better off with a contract. Among other things, the manufacturer, in selling the mouse, arguably made an implied promise to renew the necessary certificate. That’s not nothing. After all, the manufacturer apologized and remedied its failure to renew the certificate, which indicates that it considered itself bound. And that means that David has his remedy. Sure, he could sue for the value of his time lost while the mouse was not functioning, but he’s a journalist. His time is not worth the cost of the lawsuit.

Contracts are not as zipless as David wants to think they are, and I think if David thought a little bit more about it, he really wouldn’t object to having a post-sale relationship with the seller. In fact, he relied on that relationship when he programmed his mouse. These days, it’s hard to conceive of contractual transactions that are not relational to some extent, and based on the number of unsolicited surveys I get in my in-box every time I interact with a vendor, I think we are moving into the realm when “it’s complicated” will be my description of all of my situationships with vendors.

I think David has misidentified the source of his frustration. I don’t think he really wants to have no post-sale relationship with the seller. Rather, he’s frustrated because the terms to that relationship were either not disclosed to him, or they were disclosed through boilerplate terms of service that are too verbose and mind-numbing to read.

David comes through as a quirky, sympathetic protagonist, and the episode has all the other charming features of an Alex Goldman production (sound, editing, a delightful host and supporting cast of producers and researchers). In addition, the episode is especially valuable because of extended input from Stacey Higginbotham, who has her own podcast on the Internet of Things. She has all sorts of ideas for protecting consumers from experiences such as the one David had and more serious problems that might arise when a seller drops support for a connected device or when the company itself ceases to exist. For example, many sellers of connected products, it seems, do not figure into their prices the costs of ongoing support for those products. Stacey would like some sort of regulation that would require sellers to disclose how long they expect to support the product and to set away some funds in an escrow so that they can do so regardless of what becomes of the seller as an entity.

It is noteworthy that all of Stacey’s efforts will take David in the direction of having more of a relationship with vendors rather than less of one. But that’s a good thing. The value of his property is enhanced by the fact that a contractual relationship obligates the seller to maintain it in ways that David would not and also could not think of on his own. The current regulatory environment does not seem to be one in which Stacey’s ideas will get a lot of traction, but she is fighting the good fight, so godspeed.