Apple and a Federal Right to Repair

I've spent an inordinate amount of time recently, fielding calls from media outlets curious about my thoughts on Apple’s latest announcement regarding a federal Right to Repair.  To put it succinctly, it’s a masterstroke in public relations, but fundamentally, it’s smoke and mirrors. Here's why. 

What's in it for Apple? 

Apple has leveraged its considerable influence, particularly in California, to circumvent even stricter limitations being proposed in other states—limitations aimed at challenging Apple’s controversial “parts pairing” practices.  This strategy has been a death knell for independent repair businesses and consumer DIY efforts. 

Under Apple’s current terms, you must provide your device’s IMEI (serial number) directly to Apple to even purchase a part. This makes it impossible for independent repair shops to stock parts for future repairs, negating any convenience of same-day, local repairs. To put it in perspective, getting one’s rosary beads blessed by the Pope is simpler than this. 

The new California law conveniently sidesteps the issue of parts pairing and does not mandate Apple to facilitate the use of genuine, used parts as replacements. It leaves the third-party parts market in a perpetual state of limbo, thereby empowering Apple to dictate pricing. 

A Saga of Control

Once you get the part, your ordeal isn’t over. The part will not function without another interaction with Apple to “activate” it. For rural residents like myself, often without high-speed internet, this is a glaring oversight. Are we saying low-income or rural individuals don’t deserve the right to repair? 

Why Not Federal Law?

Since 2010, we've been rigorously investigating the most effective avenues for enacting repair-friendly laws. Through direct consultations with the Federal Trade Commission (FTC) and the Department of Justice (DOJ), it's become clear that states hold the constitutional reins over General Business Law. These are the same statutes that protect consumers from fraud, like lemon laws, and they can be leveraged to guard against Unfair and Deceptive Acts and Practices (UDAP).

Our research into End User License Agreements (EULAs) led us to present our findings to the FTC. The takeaway? Any product sold with a mandatory EULA is, by definition, engaging in deceptive trade practices. Original Equipment Manufacturers (OEMs) do not require EULAs to safeguard their intellectual property; instead, these agreements strip consumers of their well-established federal rights to repair. Since EULAs are often non-negotiable and sometimes even inaccessible for review, the consumer deception is blatant.

However, the limitations of federal agencies go beyond Apple. Both the DOJ and the FTC are structured to enforce violations against one OEM at a time. To grasp the enormity of this enforcement challenge, consider that the Consumer Technology Association (CTA) has 1,700 members. Using a fishing analogy: even if federal agencies were to snag a whale (like Apple), 1,699 other fish would elude capture. Given the time-consuming legal processes, we're looking at a Sisyphean task that would take 1,700 years to complete. Clearly, broader statutes and quicker enforcement mechanisms are essential.

Apple is fully aware of the forthcoming state laws that will close loopholes like "parts pairing." They argue against a patchwork of state laws, claiming it would be unmanageable. However, our template legislation, which has been introduced in 45 states, aims to be as non-intrusive as possible on manufacturers—so much so that we've been criticized for being "too light."

Lastly, Congress has a critical role that only it can fulfill: addressing outdated Copyright Law limitations originally designed to combat illegal VCR tape copying in the mid-'90s. The U.S. Copyright Office itself is seeking relief from the monotonous triennial hearings on the legality of breaking digital locks for repair purposes. Except for specific cases like computer gaming stations, all repairs are legal, but current laws inhibit the provision of necessary tools.

The Ongoing Battle

As we soldier on in our state-level advocacy, it's worth noting that the landscape is shifting strongly in our direction. While the exact number of additional laws required to tip the scale remains uncertain—be it 5 or 15—what is clear is that the opposition from most Consumer Electronic OEMs is waning. Several major brands have already taken proactive steps to improve parts distribution and customer support, changes that are likely to have a national ripple effect, irrespective of federal law.

But it's crucial to understand that the arena of this struggle is expanding. The Right to Repair movement is no longer confined to just smartphones or laptops; it's encompassing a broader array of products. Whether it's machinery used in agriculture, industrial equipment, marine engines, or even as specific as medical equipment and petite wristwatches, the fight remains the same. What changes are the dimensions and complexity of the products involved.

So, what does this mean for our ongoing efforts? It signifies that our advocacy must adapt to meet these evolving challenges. We must diversify our strategies to tackle the different facets of digital monopolization affecting not just consumer electronics, but our daily lives at large.

Our template legislation, introduced in more than 40 states, serves as a foundational step. But we must push for more comprehensive laws that take into account this expanding battleground. We'll need to engage with experts across these various sectors, build coalitions, and most importantly, continue to raise public awareness about why the Right to Repair is everyone's right, regardless of what you're looking to fix.

Unpacking California's SB 244

SB 244 – the “Right to Repair Act” is a Done Deal. Its only a day away from being sent to the Governor for his signature.

Time to unpack the law and its implications:

This law is mostly grounded in the principle that when you buy something – its yours to use, fix, or resell as you like. The legislature made political choices along the way about which kinds of equipment should be covered by this law – and its no surprise that the business interests of Silicon Valley were considered. Some of the details are less robust than in Minnesota, other details are more comprehensive than New York. Whole categories of equipment were exempted in order to fight only a few 800-lb gorillas at a time.

Similar choices were made in Colorado, New York, and Minnesota. California is a very big state and has outsize influence in policy, but is still only one of many. More states are going to make their own political choices. There will be variations – just as there are variations in tax laws, liquor laws, criminal laws, teacher credentials and just about everything else.

Manufacturers seeking consistency on what to do for compliance can do so today. Follow the centuries old principle of ownership – and restore policies that recognize the buyer – your customer – is in charge of making choices of whom they trust for buying the service of repair.

Simple.

Groups Leading “Right to Repair” Movement Urge Biden Administration to Reject Any Attempts to Derail their Gains Via “Trade” Agreement as Latest Round of Indo-Pacific Trade Negotiations Start

FOR IMMEDIATE RELEASE: September 12, 2023
CONTACT: 518-251-2837

NEWS RELEASE

Consumer, Business, Farm, Digital Groups Leading “Right to Repair” Movement Urge Biden Administration to Reject Any Attempts to Derail their Gains Via “Trade” Agreement as Latest Round of Indo-Pacific Trade Negotiations Start

Washington, D.C. – In a letter sent today, a broad coalition urged the Biden administration to safeguard progress being made in states and nationally to give consumers and businesses a “right to repair” their electronics-enabled equipment and devices, by ensuring that a digital trade agreement being negotiated as part of the Indo-Pacific Economic Framework (IPEF) does not include a special corporate secrecy shield that could block the right to repair. Signatories include American Economic Liberties Project, Center for Democracy & Technology, Consumer Reports, Farm Action, iFixit, National Farmers Union, The Repair Association, Public Knowledge, and U.S. PIRG.

The Biden administration’s battle against monopolies has spotlighted how consumers, farmers, and small businesses get abused by large manufacturers that unduly restrict access to necessary tools, parts, and information to repair their electronics-enabled equipment and devices. A burgeoning “Right to Repair” movement is making real progress at the state and federal level with five states passing legislation, and the Federal Trade Commission active in enforcing protections for users’ repair choice.

The broad coalition of consumer, business, farm, and digital groups united to raise the alarms about a rule that some in the tech industry are pushing for in the context of a major Biden trade agreement, the Indo-Pacific Economic Framework. The little-known provision, officially called “source code,” was slipped into the United States-Mexico-Canada Agreement (USMCA) in 2019 and could thwart the efforts of governments to require that manufacturers share essential information about their software, or even descriptions of algorithms. The way in which the term “algorithm” is defined in that provision could potentially be taken to mean any repair software, manual or other firmware update. The broad coalition of groups has sent a letter to President Biden urging the administration to exclude the damaging USMCA provision from the IPEF.

“People should be able to fix their stuff, and if a trade deal undercuts that, we should fix the trade deal,” said Nathan Proctor, U.S. PIRG’s Right to Repair Campaign Director. “The proposed language creates a massive loophole, undermining legislation cracking down manufacturers who refuse to provide what people need to fix their tablets, toasters and even tractors.”

“Repair.org is very concerned that including this trade language could destroy the rights of owners to control their property, remove constitutional powers granted to states, and replace it with control by dominant multinational companies, regardless of statute,” said Gay Gordon-Byrne, Executive Director of the Repair Association.

The administration has proposed a tight timeline for the IPEF, hoping to reach a final agreement by mid-November when the heads of state of the countries involved meet at a previously-scheduled Asian Pacific Economic Cooperation summit in San Francisco. The latest round of IPEF negotiations started this Sunday, September 10, in Thailand. The IPEF will set binding rules on countries representing 40% of the world economy.

“The right of consumers and businesses to choose where to get their digital devices repaired is a fundamental right of ownership. The authority of governments around the world to protect this right for their citizens should not be overridden by fine print in trade agreements negotiated in secret,” said George Slover, Senior Counsel for Competition Policy at the Center for Democracy & Technology.

“Big Tech’s so-called “digital trade” agenda has been exposed time and again as a threat to the democratic policymaking and the policies required to ensure that the digital economy works for everyone,” said Nidhi Hegde, Managing Director at the American Economic Liberties Project. “Our future cannot be determined in close-door trade negotiations, where members of Congress, civil society, and the general public have no voice. The Biden administration must immediately open up the negotiation process to public oversight and exclude any provisions that could preempt direly-needed right-to-repair reforms.”

"Most consumers who buy a smartphone or a scanner-printer would be surprised to learn that even if they wanted to, they are restricted in how and where they can get these devices repaired and save money and the environment. The right to repair something you own is a fundamental consumer right that we need to protect," said Sumit Sharma, Senior Researcher at Consumer Reports. 

“To keep their operations thriving, American farmers and ranchers must be able to repair their farm equipment as they see fit,” said Joe Maxwell, president of Farm Action Fund. “From Colorado to West Virginia to Washington, D.C., we have made strides in securing right to repair for agriculture. Yet, any language in future trade agreements that could limit policies requiring original equipment manufacturers to provide fair access to digital repair tools would cost America’s farmers and independent repair shops millions of dollars and further increase monopolization throughout the repair market.”

Read the full letter here. 

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Right to Repair for Agriculture in Colorado Moves Ahead

Last night (Thursday March 9) The Colorado Senate voted 4-3 to move Agricultural Right to Repair HB23-1011 ahead to the Senate Floor.  The House has already moved the bill by a vote of 44-17. Participants in Thursday's hearing in the Colorado Senate AG and Natural Resources Committee heard a rare, lengthy (7 hours !! ) and wide ranging discussion about the merits and pitfalls of HB12-1011. It was by far the most diligent and useful of hearings in our 10 years of experience. The Senate Chair himself explained that he went back and forth at least ten times between Yea and Nea before deciding to cast the deciding Yea vote. 

One of the key issues was the recent announcement of memorandums of understanding (MOUs) between the American Farm Bureau Federation (AFBF) and John Deere, and Case-IH.  Advocates noted that the timing of the MOU was clearly intended to forestall this legislation from moving.  Opponents argued that the MOUs would provide farmers with all the information and parts necessary for consumer-directed repair so legislation was unnecessary.   A couple of Senators advanced the argument that government shouldn’t be involved in these private matters.  All these positions were discussed at length. 

During the hearing questions were raised about if the MOUs are actually comprehensive and if the MOU format is a viable alternative to legislation.  AFBF (American Farm Bureau Federation – a signatory to the MOU) revealed that John Deere does not sell 100% of the materials necessary for complete repair, and the Customer Service Advisor tool only covers 97% of repairs that a farmer might need to make.  This matters enormously as Deere had stated in testimony in Montana in 2021 that the 2% (or 3%) are the high tech stuff dealers claimed as “off limits” for owner repair.  In the world of increasingly high-tech problems such repairs are the problems that vex farmers the most.  

The argument was ultimately made that since equipment manufacturers had agreed to provide "everything" needed for consumer-directed repair they would not be harmed by being subject to a statute. The hearing effectively called John Deere's bluff and demonstrated that MOUs were not enough to address the issue of Right to Repair. It was a very big step forward for all of us. 

Misrepresentation by Deere and Company to the US EPA and SEC

High Availability Farming

Deere & Company is stating that tractors are like aircraft in their complexity. I laughed at the thought of a flying tractor. But apart from the visual joke, the analogy makes Deere’s repair restrictions seem even more absurd.

Modern tractors are full of computers, just like aircraft, cars, and data centers. Putting a computer chip in a tractor doesn’t make it fly like an aircraft but does make it function just as a mainframe computer with multiple controllers and peripherals in a data center. Keeping that equipment up and running is a critical part of design as every farmer, pilot and computer geek knows.

In the computer industry as with aircraft, uptime—aka “High Availability”—is essential. Yet Deere has been building products using hundreds, if not thousands, of parts, any one of which is a single point of failure, and then tying the replacement of those parts to their exclusive control. Every delay created by this service model becomes a critical issue for farmers.

Aircraft are full of redundant sensors for this very reason. Data center storage is “redundant,” “hot swappable,” and “plug and play”—techniques that have allowed for the exceptional uptime that we have come to expect in the air and online. Despite the opportunity to learn from both the airline industry and data center computing, Deere has designed equipment using hundreds of small sensors without building the redundancy needed for producers to keep rolling in the event of a component failure.

When challenged by proposed legislative requirements, Deere tries to minimize their computer repair problem by stating that farmers can already fix 99% of their stuff—even when a single part can take the machine down by 100%. We know from Deere in legislative hearings that their admitted limitations are only on the “digital stuff,” which means that all of the failure and repair problems of computers (the “digital stuff”) are the big hangup for tractor repair.

Deere then argues that farmers can buy everything they need, but in practice, even if a farmer buys all the diagnostic subscriptions, buys the part, and has the tools to install the part, the final step to activate the part is monopolized by Deere. Deere firmware can only be installed and activated by a Deere Dealership tech, using firmware updates created by Deere specific to each serial number, creating the potential for massive delays and manipulation of service availability to reward larger customers.

Nor does Deere inform their customers that many of their computerized parts don’t work as spare parts without the specific intervention by Deere to activate the part in their system. When it comes to repair of farm equipment, if any step in the process is slow—, including simple supply chain shortages, weather, labor shortages, and so forth— – then farmers cannot farm. Waiting on a Deere tech to activate a part can be “harvest is ruined” slow.

If tractors are like aircraft in their complexity, it’s only because of their embedded computers. But data centers solved the uptime problem a long time ago, and they didn’t need to restrict repair to do it. In the early days of corporate computing in the 1960s, data center managers had repair techs on site 24 x 7 with a full suite of repair manuals, parts and tools. This is akin to a farmer having a barn full of everything needed to repair and a Deere tech living in the barn. The next innovation from the 1960s and 1970s was to buy a second full set of everything, which would be activated in the event of the main system failure. This is the same as buying two tractors, or having a stand-by tractor just in case.

Sound familiar? It should. Deere’s repair restrictions are forcing farmers to rely on backup tractors in exactly this way. But data centers moved beyond this system forty years ago, because it’s expensive and imperfect (what if your backup goes down, too?). Among the many innovations from the 1980s that made for easier and more efficient repair was the addition of call-home functions from the equipment itself. If a sensor detected high heat (a common problem) the machine itself could call the service provider with an alert. The repair tech could then be dispatched already knowing the diagnosis and prepared with the part needed. These functions were telephone based, pre-internet, and worked as reliably as Ma Bell could provide.

This innovation let data center manufacturers begin to offer service agreements that were time-specific and bound the provider to arrive within a short time frame, including penalties for late or incomplete repairs. Surely some dealers might benefit from offering similar programs for those willing to pay. The idea that a Deere dealership can simply show up when it is convenient for them seems horrifyingly archaic from a data center or aircraft perspective.

Even with such a simple model to follow, Deere has decided to use the internet for communications, all while knowing that much of farmland is not covered by reliable broadband and that disruptions of internet service would have profound consequences for repair. I suspect the choice of internet communications is based on Deere harvesting operational data for their own purposes and not for service delivery.

High-availability computing is normal and it has not led to theft of IP, lack of safety for technicians or customers, nor any other of the ridiculous excuses being made by OEMs to deliberately keep high-tech farming from fulfilling its potential.

Deere wants to say tractors are like airplanes? Sure, they’ve got complex computer systems. But that’s no excuse for keeping those tractors from flying the friendly skies.

Why is John Deere so opposed to letting farmers fix their stuff?

John Deere is trying to block the agricultural Right to Repair in Nebraska—which affects all of us, not just farmers. When farm equipment goes down in the middle of the season, it can cost farmers a harvest and the rest of us a meal. Everyone that eats has a horse in this race. 

And Deere is rigging the race. They have filled Nebraska’s unicameral legislature with their proxies attempting to block the passage of LB543, the Right to Repair for Agricultural Equipment. They are telling senators that Deere & Co. supports farmers repairing their equipment, but they don’t support the “right to modify” When pressed, they proclaim that farmers can already fix 98% of their equipment, so there isn’t a problem for legislators to address.  

Hogwash. Within the supposed 2% of repairs that Deere blocks are many problems that can take a machine down 100%. Fixing 98% of something rather than 100% is a farce.  Limp mode can be a death sentence for a crop. when a simple problem during key times takes the machine down 100%, not 98%. 

Plus, repair is not modification. Most farmers have no interest in doing anything with their tractor beyond the job it was designed to do—they just want it to be in good working order. So why is Deere bending the ears of nearly every Nebraskan senator, to keep farmers away from 2% of repairs? Why are they fighting 5 antitrust lawsuits ? What is Deere protecting so fiercely? 

It's likely that the answer is just money—hidden in all sorts of pockets in plain sight.  Repair in many industries is a high margin business, and monopolies on repair feed the margins.  A Virginia dealer told Farm Equipment magazine that service accounts for three times the net profit of equipment sales, even though it makes up just a sixth of equipment sales’ gross profit. 

Subscription revenue for Deere’s proprietary “Service Advisor” diagnostic software is undoubtedly high—one dealer sells the package online for $8500 for the first year (note the emphasis that this subscription provides diagnostic codes but will not authorize farmers to repair their own equipment). Without the ability for a farmer to buy an alternative set of diagnostic tools, it’s also a monopoly.  I suspect, as a former lessor, that Deere influences the used market for trade-ins around the world.

Not to mention that keeping repairs in house gives Deere a lock on data being harvested from every piece of equipment in real time. Many credit Deere’s stock rebound during the pandemic to their investment in “smart farming” equipment, including planters that pick the best spot to stick seeds based on past yields, and sprayers that have weed-destroying algorithms.  Blocking agricultural Right to Repair lets Deere keep a monopoly on the data that their new Chief Technology Officer manages.

Farmers want to use the modern tools that have so much promise to improve yields and reduce labor costs. But while Deere reaps the profits of these tools, farmers are left holding the bag. For the sake of a repair and data monopoly, Deere is happy to pay lobbyists and lawyers. They’re happy to ignore some angry farmers. That anger, though, is justified: When a farm must wait weeks for a Deere repair technician, that can mean a lost harvest—and a lost harvest can mean a lost business. 

It’s up to all of us—the farmers and the eaters—to make sure that farmers are restored true ownership of their equipment so that they can keep their equipment working 100% of the time, not just 98%. They’ve bought their tractors. Why can’t they repair them? Tell your legislators anywhere in the world that you want them to pass Right to Repair legislation now.

Biden Administration Launches Right to Repair for Agriculture - What does that mean for OEMs?

Point/Counterpoint Discussion with Gay Gordon-Byrne, Executive Director of Repair.org, and Willie Cade - Midwest Regional Director — Repair.org.

The leading trade association for the AG industry is the Association of Equipment Manufacturers (AEM) and their dealership counterparts the Equipment Dealers Association (EDA) Both have made public statements offering support with significant caveats -- which is a window into the core of their aggressive opposition to proposed legislation. 

Here are the main loopholes in their “support” statements:

We support farmers’ right to repair, but not their right to modify. 

Gay: The most obvious flaw in the statement, which the FTC Report to Congress on “Nixing the Fix”  noted is that repair isn’t modification.  Legislation directed at opening a competitive market for repair does not require modification and the FTC concurs. 

Willie: The FTC also noted that IP rights are not impacted by repair.  I think it's more telling that AEM and EDA both consistently fail to acknowledge the rights of owners of “land-based motor vehicles” to modify their software already granted in Copyright Law with the 2015 exemptions to Section 1201. ([link] 

Farmers can fix 98% of their stuff  

Gay: So much to unpack here.  First -- we don’t see any disclosure to farmers about which parts are off-limits to repair -- which is inherently unfair and deceptive.  Second -- and I think most importantly - farmers paid 100% for the product and logically expect to be able to fix 100%.  Third -- my inner cynic thinks that the 2% figure is a fabrication intended to backstop the idea being presented to legislators that there isn’t a need for legislation because there isn’t a problem any longer.   

Willie:  Plus a partial repair isn’t a complete repair. And if a product is down for a dealership visit -- that machine is 100% useless until the dealership can visit and complete the repair. We’ve been trying to get a handle on the limitations on repair directly from farmers, and our sense is that limitations on repair are far more pervasive than disclosed.  

Imagine if your car check-engine light flashes, and instead of being able to continue to drive the car shuts down entirely.  Maybe you can limp at 2 mph to a mechanic that can plug in a diagnostic tool and learn that your front headlight needs replacement.  But that mechanic can’t replace the light because only the dealership has the software tool that pairs the bulb to the VIN.  This is exactly the problem farmers face every day when a small part, even a relatively trivial part, takes the machine down.

If Right to Repair passes, farmers will hack the emission on their equipment and violate the Clean Air Act

Gay:  I’ve dug into the Clean Air Act and read compliance advice from the EPA.  I don’t see any requirements that OEMs or Dealerships are deputized to enforce the law.  There is a requirement on dealers to bring emissions back into spec if the equipment is brought to them for an emission repair -- but the EPA very clearly states the dealership doesn’t have to fix emissions if the repair request is unrelated. (https://www.epa.gov/enforcement/clean-air-act-vehicle-and-engine-enforcement-case-resolutions)

Lately, the EPA has come down hard on diesel tuners for over-the-road trucks (https://www.epa.gov/newsreleases/epa-penalizes-premier-performance-3-million-selling-defeat-devices) as evidence that they do enforce violations directly with the violators.  The schedule of fines for users is very clear as well.  Farmers that hack their emissions are subject to fines directly. 

Willie: Damn straight, OEMs are not the environmental police!  To say that producers are all “criminals in waiting,” is BS!.  It is insulting.

Trade in Values will be diminished if farmers mod their engines to run at higher Horsepower.

Gay: This is simply wild. The farmer, as the owner making the trade-in or private sale, is the only party that benefits or loses value based on equipment condition.  Dealerships should be taking equipment conditions into account when making an offer -- just like a car dealership evaluates the trade value.  If Dealers aren’t savvy enough to pick up on mods, that's on them.  If the tools to evaluate conditions are inadequate -- then dealers should be asking for better tools. 

Willie: Deere created the one machine series with firmware-controlled settings.  The machine itself is built to run at the max settings, so it's not going to hurt the machine if the farmer goes to the max.  This is a pricing problem for Deere and not a technical one. 

Are producers really upset about this issue?

Gay: Producers are livid about any limitations on repair. Why not just let the farmer buy the pairing tool and the parts?  Is there that much money to be made on repair? 

Willie:  There is a great deal of money to be made on repair.  IBISWorld estimated repair spending in the U.S. in 2018 at $39.1 billion for heavy machinery.  Now that agricultural equipment has been “computerized,”  what has been for generations a repair industry composed of small, independently run operations now is controlled by OEMs via software.  This represents a high margin growth opportunity.  Even the OEM’s dealers are having to fork over more money and they are not happy about that!.  This problem is only going to get worse as the percentage of computerized equipment in a producer’s fleet increases. 

Is this really all about the price of their stock?

Gay and Willie:  OF COURSE!

REPORT Towards a more sustainable single market for business and consumers

The vote calls for the EU Commission to “develop and introduce mandatory labelling, to provide clear, immediately visible and easy-to-understand information to consumers on the estimated lifetime and reparability of a product at the time of purchase.”This won’t change anything immediately—it’s a call for the government to work on setting up these initiatives—but it is a major vote of confidence in us and a huge step forward. It sets the stage nicely for implementation of the French labeling system and US state Right to Repair bills in January.Credit for this goes to our allies across #Europe. French MEP David Cormand is a real hero of the revolution!