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There is a growing legislative movement – yes, elected politicians are always looking for something to do – to create and enforce a “right to repair” your stuff. It applies to cars and trucks but the newest candidate for inclusion concerns your electronic gadgets.
You have probably had experience with the problem. Your iPhone breaks and you are looking for someone to fix it. But then you become aware of a problem. If you take it to a street vendor or some other random repair person, your device falls out of warranty. That’s dangerous because if the repair fails, you have a paperweight instead of a phone.
The right-to-repair movement has a legislative agenda to force companies to stop practices that penalize customers for taking their things to independent repair shops. It sounds rather unobjectionable, even consistent with free-market thinking. Just such a movement ended John Deere’s claim that its truck can only be repaired by authorized dealers.
The New York Times gives the pitch against repair restrictions for the right to repair:
This is unfair to consumers who might be able to obtain, or perform, lower-priced repairs. It’s unfair to independent businesses that might do the work. And it’s bad for the environment, because the high cost of repairs leads people to toss devices that might have been fixed…
The company is welcome to persuade people to patronize its own repair facilities, or to buy new iPhones. But there ought to be a law against forcing the issue. An open marketplace for repairs benefits consumers, independent retailers and the environment. Modern devices are increasingly complicated; that concept is not.
This more or less sounds like the editorial is for a competitive free market, especially with the pean to independent businesses thrown in here – because we know how much the Times editorial page just adores them </sarcasm>. If you are reading carefully, the phrase “ought to be a law” should be a red flag. Do we have a market failing here? Another word that stands out in this text is “force.”
So let’s think about this.
Property and Contracts
So yes, if you own your phone, you can do with it what you want. At the same time, your right to hack your phone does not impose an obligation on the company to continue to enforce the warranty that came with the phone. This is what is at issue. This debate isn’t really about a right to repair; it is about a legal obligation to comply with a warranty no matter what.
A law that forces a company to repair its own hacked goods is not a free market; it is involuntary servitude. And the threat that this is coming is real: the Federal Trade Commission in hosting an event to explore the issue in more depth in July 2019.
There are many reasons why such laws create enormous problems. They might help in creating a market for repairs that might not otherwise exist. It is one thing to replace a cracked screen, and quite another to tear apart the phone and start messing with highly complex machinery inside. This could be an invitation to scam artists who don’t have to bear liability for the messes they cause simply because the customer can always fall back on the dealer while invoking the warranty.
It seems right, then, that warranties would be conditional. New legislation affirming the right to repair is not affirming property rights but rather violating them. To be sure, there is a very obvious economic incentive that manufacturers have to exaggerate the dangers of unapproved repairs. Even simple repairs are vastly more expensive from dealers than from independent businesses.
Think about this as it relates to cars. If you own a ten-year-old Honda, do you take it to the dealer? If you do, you either don’t know the racket or you don’t care about money. Everyone knows, one supposes, that going to the dealer for simple repairs is a financial mistake. More complex repairs require that the user make more careful decisions.
In other words, the free market here seems to be working just fine, without impositions of new laws that risk creating strange distortions in the market.
There is an additional sticky issue here, however. It concerns intellectual property rights. Both John Deere and iPhone have claimed that there are trade secrets embedded in their technology. The companies own this information and it cannot be taken from them by third parties. Publishing repair manuals and technical specifications would be a violation of their intellectual rights.
Apple, in particular, has invoked the Digital Millennium Copyright Act in defense of its strict policies against third-party repairs. I’ve spoken to a few people in the industry and they have assured me that this is nothing other than a ruse, a grasping for straws to maintain a monopoly on repair services.
This seems right to me. Intellectual property claims are replete with rent-seeking moves to achieve legally enforced monopolies. There is zero chance that the fix-it guy at a booth in the mall is going to rob technology and then compete with Apple. Even if he could achieve that, any consumer could do the same.
It’s a fair guess that Apple’s invocation of IP here is nothing but legal smoke and mirrors.
Admitting that doesn’t make the case doesn’t justify using further forms of forms to invalidate contracts that Apple makes with customers. And that is precisely what right-to-repair legislation does. This is not the free market at work. It is government intervention that steals the language of market competition to invalidate property rights and contracts.
[Originally Published at AIER]