FTC to Sony BMG: Decpetive DRM Will Not Be Tolerated

Sony BMG has settled with the FTC on charges that their CD copy protection scheme (i.e. rootkit fiasco) violated Ferderal Law. In a recent press release, FTC chairman Deborah Platt Majoras declared:

“Consumers’ computers belong to them, and companies must adequately disclose unexpected limitations on the customary use of their products so consumers can make informed decisions regarding whether to purchase and install that content.”

The settlement also:

• requires clear and prominent disclosure on the packaging of Sony BMG’s future CDs of any limits on copying or restrictions on the use of playback devices.
• bars the company from installing content protection software without obtaining consumers’ authorization
• bars Sony BMG from using the information on consumers’ listening preferences that it has already gathered through the monitoring technology it installed and bars them from using the information to deliver ads to those consumers
• requires Sony BMG to reimburse consumers up to $150 to repair damage that resulted directly from consumers’ attempts to remove the software installed without their consent.

This raises several issues:

1. How will consumers react t0 such labeling (assuming Sony BMG even bothers to reinstate this technology in a modified form) and;
   
2. Can the FTC's ruling be applied to DRM on a broader scale? If so, perhaps we may be following in Norway's footsteps sooner than we thought . . .
   

(via Video Business)