Terms of use need balance
TECHWATCH: Deal must consider rights of both parties
By DAVID CANTON, Special to QMI Agency
   


Have you ever considered what a service provider -- such as a cellphone company or social networking site -- can do with the photos and other content you send or post using that service?

Sometimes the terms of use of the service provider are so broad they give the provider the right to use it for things such as their advertising, or to be able to sell user content for the service provider's own gain.

Terms of use, or terms of service, are the rules we agree to when we contract to use a service. That might take the form of a written contract we sign when we purchase a cellphone, or the click-wrap agreement we click "I agree" to when we subscribe to a social media service such as Facebook or Pinterest.

Terms of use often include some form of licence or permission language stating what the provider can do with content users send or post using the service. Defining that is important to make clear what rights the service provider has to that content. In most circumstances, that licence language should grant the service provider rights to the content that it reasonably requires to provide its services.

Occasionally, these licence permissions are drafted overly broad and grant the service provider the right to do almost anything it wants with the content.

For example a cellphone provider was recently criticized for language that said it: "will be free to copy, disclose, distribute, incorporate and otherwise use the content and all data, images, sounds, text, and other things embodied therein for any and all commercial or non-commercial purposes."

In most cases, such overly broad language is not a nefarious plot to acquire user content for the service provider's own use or profit. It is more likely the result of contract drafting that has not been thought through properly.

The drafter was rightly thinking the terms of use needed some licence language to define what the service provider can do with the user's content. And the language does indeed give the service provider the rights it needs. So from that perspective the clause works.

But the clause is a failure because it grants rights that the service provider doesn't need, and doesn't want. And it fails to look at the issue from the perspective of what uses a user would be comfortable granting to the service provider.

In other words, the clause does not balance the rights and needs of the parties.

So why would a service provider care, given that most people don't bother to read terms of use?

Some people do read them, and eventually the language will end up being publicly criticized. That doesn't bode well for the reputation of the service provider, and it may never know how many potential users voted with their feet and didn't use their service because of the overly broad language.

David Canton is a business lawyer and trade-mark agent with a technology focus at Harrison Pensa LLP. This article, written with the assistance of Vanessa Horsburgh, contains general comments only, not legal advice. Contact David at 519-661-6776 or www.canton.elegal.ca






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