What to know when using or sharing software

If you’ve ever bought software, you might have questioned whether you could sell the CDs or make a duplicate of the application for a customer or friend. Unfortunately, sharing software is frequently prohibited, and software creators are legally entitled to set additional conditions for usage in addition to prohibiting the transfer. Why then are software programs bound by such limitations?

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Software programs are protected by U.S. copyright law … but that’s not all

The law recognizes software programs as “literary works” for the purposes of copyright protection, making them original, copyrighted works. As a result, the Copyright Act protects them as intellectual property and gives writers the only authority to duplicate and disseminate copyrighted works.

The “first sale doctrine,” which gives the buyer of a copyrighted work the ability to transfer (buy, sell, or trade) that work to someone else without violating the author’s copyright, has, nonetheless, provided benefits to consumers for almost a century. Or, to put it another way, if you bought it, you own it—the actual copy, that is—and if you own it, you may sell it (you certainly don’t own the rights to a novel by buying one copy).

Software programs are not sold, they are licensed for use

You just spent $399 for a software suite and are now through with it. You wish to recuperate part of your money by selling the CDs once you’ve uninstalled the apps from your computer. Don’t even consider it. Exactly why not? Why are software programs immune from the “first sale doctrine’s” protections? Since just a license to use the program was obtained when a customer paid for it, no sale of the work had really taken place. Once it is determined that your “purchase” is actually a license rather than a physical object, the licensor (such as Microsoft, Adobe, etc.) is free to limit licenses in any way it sees fit.

For the majority of customers, who are used to living in a society where it is entirely lawful for the owners of secondhand books, CDs, DVDs, and other copyrighted works to sell them, the concept that a license to use a product was acquired, rather than the product itself, seems counterintuitive. Unsurprisingly, individuals who have sought to sell secondhand software CDs have been sued on both sides of this issue. The lesson is: Avoid. You’re breaching the law and the terms of your license.

The terms of a license are contained in the End User License Agreement (EULA) that comes with the software

The EULA for the program specifies a consumer’s transfer rights. As an illustration, an EULA may read: “SCOPE OF LICENSE. Not sold, but licensed, is the software. Your access to the program is restricted by this agreement. All other rights are reserved by COMPANY X. Neither the program nor this agreement may be transferred to a third party.

That’s all, then. The user is assumed to have agreed to this agreement and is consequently bound by its terms in return for the ability to use the program.

What about other restrictions on use of the software program?

There may also be other limitations on use, some of which are imposed automatically, such as how many machines you are allowed to download the application onto. For instance, after a certain number of downloads, certain software applications include a built-in mechanism for counting how many times the program has been downloaded and will prevent further downloads. Even though the buyer owns both computers, the EULA of one online gaming application prohibits users from installing the game onto more than one device and mandates a one-month waiting time before switching devices.

Read the license agreement

It’s a good practice to read the EULA for software applications before you acquire them to prevent being caught off guard by limited use. Manufacturers have responded to consumer complaints (and legal actions) about the inability to read the EULA before downloading by putting EULAs online. Salespeople can also be a valuable resource since they frequently know the important software use limits. Consumers are nevertheless obligated by the terms of the EULA, whether they were understood before or after installing the program.