Words have meaning. Proper word selection is integral to strong communication, whether it's about relaying one’s feelings to another or explaining the terms of a deal, agreement, or transaction.
Language can be confusing, but typically when something is available to "buy," ownership of that good or access to that service is offered in exchange for money. That’s not really the case, though, when it comes to digital content.
Often, streaming services like Amazon Prime Video offer customers the options to “rent” digital content for a few days or to “buy” it. Some might think that picking "buy" means that they can view the content indefinitely. But these purchases are really just long-term licenses to watch the content for as long as the streaming service has the right to distribute it—which could be for years, months, or days after the transaction.
A lawsuit [PDF] recently filed against Prime Video challenges this practice and accuses the streaming service of misleading customers by labeling long-term rentals as purchases. The conclusion of the case could have implications for how streaming services frame digital content.
New lawsuit against Prime Video
On August 21, Lisa Reingold filed a proposed class-action lawsuit in the US District Court for the Eastern District of California against Amazon, alleging "false and misleading advertising." The complaint, citing Prime Video’s terms of use, reads:
On its website, Defendant tells consumers the option to 'buy' or 'purchase' digital copies of these audiovisual works. But when consumers 'buy' digital versions of audiovisual works through Amazon’s website, they do not obtain the full bundle of sticks of rights we traditionally think of as owning property. Instead, they receive 'non-exclusive, nontransferable, non-sublicensable, limited license' to access the digital audiovisual work, which is maintained at Defendant’s sole discretion.
The complaint compares buying a movie from Prime Video to buying one from a physical store. It notes that someone who buys a DVD can view the movie a decade later, but “the same cannot be said," necessarily, if they purchased the film on Prime Video. Prime Video may remove the content or replace it with a different version, such as a shorter theatrical cut.
Amazon has fought this fight before
In 2020, Amanda Caudel filed a similar complaint [PDF] in the same court as Reingold. Caudel's complaint argued that Amazon “secretly reserves the right to terminate the consumers’ access and use of the Video Content at any time, and has done so on numerous occasions, leaving the consumer without the ability to enjoy their already-bought Video Content.”
Caudel's case was dismissed [PDF] in October 2021 with the judge ruling that the plaintiff lacked “standing.”
California law reignites debate
Despite the dismissal of similar litigation years ago, Reingold's complaint stands a better chance due to a California law that took effect in January banning the selling of a "digital good to a purchaser with the terms ‘buy,’ ‘purchase,' or any other term which a reasonable person would understand to confer an unrestricted ownership interest in the digital good, or alongside an option for a time-limited rental.”
There are some instances where the law allows digital content providers to use words like "buy." One example is if, at the time of transaction, the seller receives acknowledgement from the customer that the customer is receiving a license to access the digital content; that they received a complete list of the license's conditions; and that they know that access to the digital content may be "unilaterally revoked."
A seller can also use words like "buy" if it provides to the customer ahead of the transaction a statement that "states in plain language that 'buying' or 'purchasing' the digital good is a license," as well as online access to terms and conditions, the law states.
The California legislation helps strengthen the lawsuit filed by Reingold, a California resident. The case is likely to hinge on whether or not fine print and lengthy terms of use are appropriate and sufficient communication.
Reingold's complaint acknowledges that Prime Video shows relevant fine print below its "buy" buttons but says that the notice is “far below the ‘buy movie’ button, buried at the very bottom” of the page and is not visible until “the very last stage of the transaction,” after a user has already clicked “buy.”
“This does not meet the standards set by the statute for a clear and conspicuous notice that the thing they are purchasing is a revocable license to access the digital good,” the complaint reads.
Speaking about the case with Ars Technica, Danny Karon, a consumer attorney who has taught class-action litigation at the University of Michigan Law School and Ohio State University Moritz College of Law, said:
… Amazon is sure to argue that, never mind its ‘buy’ or ‘purchase’ language, the rest of the story was described (or buried) in its terms and conditions. If plaintiff didn’t want to read her contract, including the small print, that’s on her.
The plaintiffs will be challenged to prove that Amazon's communication was ineffective and inaccurate.
"One has to prove that when they bought the movie, they were given indication that they 'owned it' in perpetuity and that they were harmed when the movie was taken away," Rahul Telang, a professor of information systems at Carnegie Mellon University’s Heinz College who has researched the digitization of copyrighted industries, told Ars.
"I think it is well established that digital products are licensed and they cannot be used as physical products. One has to prove that Amazon provided false information that they were buying a product ..."
Karon, pointing to Amazon’s choice of words, told Ars: “I like plaintiff’s chances.” He explained:
A normal consumer, after whom the California statute at issue is fashioned, would consider ‘buy’ or ‘purchase’ to involve a permanent transaction, not a mere rental, as is occurring here. If the facts are as plaintiff alleges, Amazon’s behavior would likely constitute a breach of contract or statutory fraud.
The attorney added that such complaints could be more viable if the content purchased from the plaintiffs was removed from the service.
The complaint requests a jury trial and is seeking unspecified damages, including the disgorgement of relevant profits.
A break in communication
The two lawsuits against Prime Video highlight consequential gaps in understanding among people who spend money on digital content. Both cases could contribute to potential changes in how the streaming industry describes digital content transcations moving forward. Prime Video is the target of both suits discussed, but other streaming companies, such as YouTube, also use the word “buy” when selling long-term licenses for digital content.
Streaming is now the most popular way to watch TV, yet many are unaware of what they’re buying. As Reingold's lawsuit points out, paying for content in the streaming era is different from buying media from physical stores. Physical media nets control over your ability to watch stuff for years. But you also had to have retrieved the media from a store (or website) and to have maintained that physical copy, as well the necessary hardware and/or software for playing it. Streaming services can rip purchased content from customers in bulk, but they also offer access to a much broader library that's instantly watchable with technology that most already have (like a TV and Internet).
We can debate the best approach to distributing media. What's clearer is the failure of digital content providers to ensure that customers fully understand they’re paying for access to content, and that this access could be revoked at any time.
There’s an argument to be made for thoughtful word choices that communicate clearly to customers. Ars asked Amazon if it might change its word choices on Prime Video to avoid the potential confusion embodied by the aforementioned lawsuits. We didn’t receive a response.
