With Glass, Google Steals 'Control Freak' Label From Apple

By Josh Wolonick  APR 23, 2013 12:40 PM

Testers may not resell or loan their Glass. Developers may not use advertisements or charge for download or use of their apps. Failure to comply will result in deactivation.

 


I’ve been daydreaming about Google (NASDAQ:GOOG) Glass since I first read about the project what seems like years ago: a pair of glasses with a computer screen in them. My mind went back to a show at Universal Studios in Orlando, Florida, T2 3-D: Battle Across Time. In a pre-show video for the attraction, a faux advertisement for the fictional Cyberdyne Systems (the company that unleashed Skynet) featured a contact lens with a computer in it. In the video, Shaquille O’Neal used the optic computer to help him nail a three-point shot. The news of Google Glass stirred me just as that video did when I was kid.

Consumers have been daydreaming about using the device to access Facebook (NASDAQ:FB) on the go, or to translate foreign languages instantaneously and discretely. (I’m sure there have been some more devious ideas as well.) On the other side of the tech industry, developers have been daydreaming about applications they will build, and about profits they will take. Google made news last week when the Glass Explorer Edition terms and conditions were leaked on the Internet: The device, at least in its initial Explorer phase, will put limits on both consumers and developers that will seriously alter the Glass experience.

Consumers Are Limited

On February 20, 2013, Google opened its Glass Explorer Program, stating that it was looking for “bold, creative individuals” who would be the first users of the device before its mass market launch. To apply, users had to post a message to Google+ or Twitter, explaining in 50 words or less what they would do with the device, using the hastag #ifihadglass. The program ended a week later, and those lucky chosen few were given the option to buy Glass, at the price of $1,500. For those who decided to drop the cash, Glass will be arriving on their doorsteps shortly. With a few limitations.

The following is a passage from the Explorer Edition terms of use:

You may not resell, loan, transfer, or give your devices to any other person. If you resell, loan, transfer, or give your device to any other person without Google’s authorization, Google reserves the right to deactivate the device, and neither you nor the unauthorized person using the device will be entitled to any refund, product support, or product warranty.

So, imagine you told Google you would document trends of socioeconomic upheaval in New York City, but you really just wanted to sell it on the Internet for profit. The minute you sell it, the device will be forever and irreversibly (as far as we know) shut down, and neither you nor the new owner of the device will be able to get a refund.

How can a company limit a consumer’s right to use a product in any way once its been legitimately bought? As the device is a kind of prototype, it is likely the measure is just precautionary, and that the full market release of the device will not place such limits on resale or loaning. 

Moreover, it is not uncommon for tech companies to limit what are commonly referred to as “sales,” but are in some aspects, very long term rentals.

As John Weber, the SEO Specialist at Geek Powered Studios told Minyanville, “This question of limited use is nothing new, as iTunes (NASDAQ:AAPL) has been quietly restricting digital music purchases for years. In fact, when you ‘purchase’ a song from iTunes, you are not actually buying a product, but rather a license to listen to that particular song.”

Can the same be said for Glass? In the case of the Explorer Edition devices, it seems that way. It remains to be seen if Google will limit a consumer's full rights to device as it enters the mainstream marketplace. If it does, the word “buy” should be substituted for “rent” or something more accurate. Otherwise, there could be legal dispute over the device and the companies limitations on consumers. On March 19, 2013, the Supreme Court decided the case of Kirstsaeng v. John Wiley & Sons, Inc., issuing a decision that clarifies that “first sale” doctrine protects the resale of a legitimately purchased good, even if it is moved across national boundaries. The doctrine of first sale, part of section 109(a) of copyright law, means that the owner of a particular copy of a work may do whatever he or she wants with it after purchase.

The question is, are users of the Glass Explorer Edition buying their devices, or are they buying a license for their use, as Google sees fit? Developers Are Limited

Perhaps even more surprising are the limits that Google has put on developers for the first wave of Google Glass: Developers will not be allowed to advertise on the Glass’ screen, nor will they be able to charge any fee for their apps. Therefore, all the typical routes for developer revenue have been cut, at least for now. Additionally, Google wrote in the terms of use:

You may not use user date from your API Client for advertising purposes. You may not sell or transmit any user data received from your API Client(s) to a third-party ad network or service, data broker, or other advertising or marketing provider.

On top of it all, developers must agree to distribute their software exclusively through Google. This raises the question: How will developers make money with the Google Glass platform, without any download fees or advertisements? Perhaps Google will pay developers directly for apps? Or the company may change its terms in the future.

Another question is raised: Will Google employ (and/or eventually sell) user data for advertising purposes, thereby guaranteeing itself a Google Glass-gathered data advertising monopoly? The company says it won’t display ads on Glass itself, but in our multiple-screen world, data from Glass devices around the world could potentially inform mobile and desktop ads. As the current terms spell out, third-party developers are strictly prohibited from sharing or selling any information they gather from the devices of Glass testers, but it's not clear what Google intends to do with its data.

Will These Limits Be the Status Quo?

When you add the Internet, tech-savvy consumers, and huge companies that release potentially industry-changing devices every few years, you get speculation and rumors. These strict limits on consumers and developers may well be just part of the Glass’ first days of public use, and will disappear when the device is openly and wildly sold. If, however, this is not the case, a backlash is likely, but will it change anything?

Perhaps most amazing is that, with current technology, we live in a time when such a policy is possible, when Google can remotely deactivate Google Glass if a user strays from the terms of use. That this is possible is amazing enough, but that a company would actually employ such a policy seems fit for a science fiction novel. 

It's likely that these strict terms of use are meant to protect the product in its infancy before more lax rules are set in place for a wide release. Still, such limitations on consumers, along with news of, among other things, illegal data collection in Germany, make scrutiny of Google inevitable and necessary. 

Follow me on Twitter: @JoshWolonick and @Minyanville
No positions in stocks mentioned.