The Software Vendor CYA: Who’s the Real Arse, Them or Us?

Is it just me, or does it seem that high-tech companies are more desperate than ever to cover their asses—legally—than actually innovate and delight their customers?

For those not familiar with the “Cover Your Ass” (CYA) phenomenon, I once again turn to the Urban Dictionary for assistance: “Extraordinary precautions that are necessary in an overly litigious society.” The example: Make sure you document everything just to CYA. Those attorneys are ruthless.

That the CYA mindset is so embedded in every product or service today is sickening. And the high-tech industry—software makers, in particular—can claim some of the worst offenders. Every little customer interaction has got to be lawyered up first. Fault should always lie with the customer!

The results of such a twisted approach can be stupefying. When’s the last time you read—in its entirety—a Microsoft or Oracle software-licensing agreement? Facebook privacy page disclosure? iTunes e-commerce agreement? Ticketmaster’s terms of service? An AT&T or Verizon Wireless contract before clicking “yes” and being legally bound to its terms?

Be honest.

If you answered “almost never,” you’re probably not alone. I couldn’t find any survey data on that point, but the fact at how easily tech companies are able to get us to click on the “I Accept These Terms and Conditions” CYA buttons, and the proliferation of such buttons on the Web, leads me to believe that not many people are reading these agreements thoroughly.

Here’s just one example: Microsoft’s Information on Terms of Use. Nearly 5,000 words of “Get Out of Jail Free” written by Microsoft for you! There are a lot of hilarious passages in the text (no, not really), but here’s my favorite:

IN NO EVENT SHALL MICROSOFT AND/OR ITS RESPECTIVE SUPPLIERS BE LIABLE FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES WHATSOEVER RESULTING FROM LOSS OF USE, DATA OR PROFITS, WHETHER IN AN ACTION OF CONTRACT, NEGLIGENCE OR OTHER TORTIOUS ACTION, ARISING OUT OF OR IN CONNECTION WITH THE USE OR PERFORMANCE OF SOFTWARE, DOCUMENTS, PROVISION OF OR FAILURE TO PROVIDE SERVICES, OR INFORMATION AVAILABLE FROM THE SERVICES.

Or this gem from Adobe’s Terms of Use page, 2,054 words strong: “You agree to defend, indemnify, and hold harmless Adobe, its officers, directors, employees and agents, from and against any claims, liabilities, damages, losses, and expenses (including reasonable legal and accounting fees), arising out of (i) your violation of these Terms of Use, and/or (ii) violation of applicable law.” (Its “agents”?? Whatever.)

I singled out Microsoft and Adobe, but this stuff is standard operating procedure in software and hardware circles these days, where quality and privacy “assurances” offer anything but. (For further fun reading, learn about Ticketmaster’s “Terms of Service” case, on the Electronic Frontier Foundation site.)

Amy Konary, a research director at IDC who knows software pricing and licensing better than most, recently offered up this tweet: “Perusing licensing FAQs on various ISV Websites. Most are completely unreadable, even for someone that actually likes this stuff. Ick!”

But to solely blame the high-tech vendors and online service providers would be misplaced. Sure, the tech world has become a sea of NDAs, embargoes, confidentiality agreements and on and on, but some of that’s attributable to the fact that we have all implicitly allowed that to happen without consequence. Online, we’ve already proffered our “Unconditional Surrender” to them long ago with our “I Agree” clicks.

Innovation can still happen today—but not before the lawyers have their way with it.

For sure, there’s a monsoon of innovation coming from “The Cloud,” and it’ll be interesting to watch to see if CIOs and enterprise technology customers attempt to put more teeth into their licensing and service agreements this time around.

Already, according to Yankee Group research, there’s been plenty of customer-side “fine print” disappointment with cloud computing.

Advises Yankee Group: “Enterprises must take a close look at the small print before they proceed.” Same as it ever was.

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