Six major manufacturers must change their illegal warranty policies says the FTC

[Cal Jeffrey]

Last month we reported that the Federal Trade Commission (FTC) had sent letters out to six companies warning them that their warranty policies were anticompetitive. At that time the FTC would not reveal which companies it was targeting. All it would say is that the companies market and sell automobiles, mobile devices, and video game consoles.

Thanks to a Freedom of Information Act (FOIA) request filed by Motherboard, we now know which six companies have received the warnings. The automobile manufacturer is Hyundai. The mobile device makers are Asus and HTC. The three big console makers Sony, Microsoft, and Nintendo, round out the group.

The letters that these companies received from the FTC warn that their warranty practices may violate a 1975 law called the Magnuson-Moss Warranty Act. This statute states that a company cannot put repair restrictions on its products unless they provide the parts or services for free or are otherwise granted a waiver from the FTC.

“Provisions that tie warranty coverage to the use of particular products or services harm both consumers who pay more for them as well as the small businesses who offer competing products and services.”

One of the provisions that the FTC is taking issue with are those stickers inside products that inform you that your warranty will be voided if the label is tampered with or removed. Of course, these seals are put in places where they have to be removed or broken to make a repair.

The FTC also mentions other warranty language that might violate the law including:

The use of [company name] parts is required to keep your . . . manufacturer’s warranties and any extended warranties intact.

This warranty shall not apply if this product . . . is used with products not sold or licensed by [company name].

Even though many other companies have similar warranty practices, the FTC is likely using these high profile manufacturers to send a message to the rest that this conduct is not okay and that it is, in fact, illegal to restrict consumers with these types of policies.

This is actually a big blow to companies like Apple, AT&T, John Deere, and others that have been lobbying against the Right to Repair movement. Having the FTC in the R2R’s court is a big plus for third-party repair shops and consumers pushing for the freedom to chose where to have their products serviced.

Several locales including California are considering redundant legislation that essentially duplicates the language of the Magnuson-Moss Warranty Act since it seems the federal law has been forgotten. Hopefully, the FTC's letters will be a reminder to companies that the rules are still on the books.

The companies targeted had 30 days to from receipt of the letters to update their warranty policies. That deadline arrives in just over a week. The FTC will check at that time if appropriate changes have been made. Firms found in non-compliance may face enforcement actions from the government.

Permalink to story.

https://www.techspot.com/news/74427-six-major-manufacturers-must-change-their-illegal-warranty.html

 

[wiyosaya]

The corollary to Murphy's law in practice: Every once in a while, the government gets something right.

 

[RaXoR]

Needs to include Apple in there. At this point they'll make changes to their devices to make it impossible/harder to open.

 

[OutlawCecil]

Needs to include Apple in there. At this point they'll make changes to their devices to make it impossible/harder to open.

That's kinda what I was thinking. What stops companies from complying with this, but then using super unique and complicated shaped screws so it's nearly impossible to get devices open. They could even change it up with every new model so even if you found a tool to use, it wouldn't work on anything else...etc.

EDIT: Side note, I repair laptops and already see practices like this by big brands. They will hide screws under stickers, add very cheap plastic clips, and even utilize glue in hopes that somebody will break it when trying to do their own repairs. Shady...

 

[IAMTHESTIG]

Heh...

Some devices are getting so small and so tightly packed that it is very difficult if not impossible to properly repair them. Tablets and smartphones are certainly in this category. I suppose a law could be passed that said manufactures must made devices that are repairable by the average public repair shop, but that is quite subjective and everyone will have a different opinion on that.

Maybe we should just stop buying stuff you can't repair? Thoughts?

 

[wiyosaya]

Needs to include Apple in there. At this point they'll make changes to their devices to make it impossible/harder to open.

That's kinda what I was thinking. What stops companies from complying with this, but then using super unique and complicated shaped screws so it's nearly impossible to get devices open. They could even change it up with every new model so even if you found a tool to use, it wouldn't work on anything else...etc.

EDIT: Side note, I repair laptops and already see practices like this by big brands. They will hide screws under stickers, add very cheap plastic clips, and even utilize glue in hopes that somebody will break it when trying to do their own repairs. Shady...

From a product design/reliability standpoint, those practices might be to keep the screws from loosening or falling out - especially on products that might see a lot of vibration from usage.

A specific sticker with a "warranty void if removed" that covers a screw/fastner, however, is aimed at anyone who attempts a repair and invalidating that warranty if that repair is attempted. It is possible that someone attempting a repair might break something that is under warranty and then try to get it repaired as if it were a true warranty failure - so I can see why they adopted this practice. However, I do not agree with it in principle.

Heh...

Some devices are getting so small and so tightly packed that it is very difficult if not impossible to properly repair them. Tablets and smartphones are certainly in this category. I suppose a law could be passed that said manufactures must made devices that are repairable by the average public repair shop, but that is quite subjective and everyone will have a different opinion on that.

Maybe we should just stop buying stuff you can't repair? Thoughts?

At one point, I built several Heathkit products including a TV. At that time, many components were still discrete, that is, instead of relying on integrated circuits (ICs), there were many discrete transistors in them. Now, however, discrete transistors are very rare as they are subsumed inside ICs. Repair of such devices has gone from changing a transistor to replacing a board because desoldering the IC would be a labor intensive if not very difficult to impossible task if it is surface mount.

And around that time, there was a good guide to consumer product repair in "Sam's Photofacts." Sam's did not have every device, but the ones they covered often included schematics and troubleshooting guides. These were often available at public libraries.

However, that lends itself to the idea that consumer electronic devices could, potentially, be consumer repairable IF there are good guides as to what to replace, and the components needing replacement are connected by some sort of plug that does not need to be desoldered to remove it.

On the other hand, IMO, a repair of any sort is going to be best accomplished by people with technical knowledge, and those without such knowledge may be more inclined to take something to a repair shop rather than try it themselves - unless the repairs are easy.

 

[Uncle Al]

They need to include ALL manufacturers AND game makers in that one too!

 

[wiyosaya]

They need to include ALL manufacturers AND game makers in that one too!

This order does not cover all the companies, however, the ruling with regard to the legality of the stickers does. If other companies do not comply, they will be subject to the wrath of the FTC.

 

[cliffordcooley]

Where were they twenty years ago. Why are they doing something now? What changed? I can remember cutting them ages ago.

 

[Cal Jeffrey]

They need to include ALL manufacturers AND game makers in that one too!

They need to include ALL manufacturers AND game makers in that one too!

This order does not cover all the companies, however, the ruling with regard to the legality of the stickers does. If other companies do not comply, they will be subject to the wrath of the FTC.

I can almost guarantee this is not the last we have heard of it. This is like the teacher upon seeing the entire class chewing gum, telling six of them to go spit it in the trash or go to the principal's office. They are hoping to see how many follow suit and then deal with the rest.

 

[mbrowne5061]

Heh...

Some devices are getting so small and so tightly packed that it is very difficult if not impossible to properly repair them. Tablets and smartphones are certainly in this category. I suppose a law could be passed that said manufactures must made devices that are repairable by the average public repair shop, but that is quite subjective and everyone will have a different opinion on that.

Maybe we should just stop buying stuff you can't repair? Thoughts?

You could possibly make it more objective by assigning a dollar value to the tools/material costs needed to make a repair; below a certain amount, and those warranty stickers can't be applied.

Say, the optical drive in my Xbox One fails. That's, say, a dozen screws, a cable or two (replaced, or re-used), and the drive itself. Easy. Need a screw driver and a new optical drive, and you're done. Maybe add a carve out for damage caused by the user, if they cause it during the repair - treat just like you would if they damaged it during normal use. But say one of the ICs failed? No, no one other than the original manufacturer should be able to make that repair (and the warranty still be honored), because that requires reflow ovens, special tweezers, a new IC that probably can't be easily obtained outside of some place like Mouser (can be pretty easy to order the wrong one without knowing it too), and a fair amount of technical knowledge, and ESD protection for the entire process. Not something the average consumer or repair shop should be attempting - if it is even an option for them.

The problem is, in trying to keep users from attempting to repair a PCB full of sensitive ICs, they block them from being able to make even simple repairs. Get rid of the stickers and seals, allow users to open their products to make repairs, and allow companies to choose not to honor warranties on things like PCBs if it appears that a third party attempted to repair it.

But the real question is: what good are these warranties if a user feels they need to make the repair themselves while the warranty should still be considered valid? If my device fails, for any reason other than accidental damage, during my warranty period, I expect it to repaired at no cost to me and in a timely manner.

 

[mailpup]

Most people might be familiar with the Magnuson-Moss Act through its other informal name, the Lemon Law, which is well known to apply to cars. Although the Magnuson-Moss Act has been applied to automobile warranties since its inception, it now appears to being applied to other industry warranties now but it's nothing new in and of itself. While if something in your product fails during the warranty period, naturally you might want to take it back to the manufacturer (or authorized place) for free warranty repair, you (or an independent shop) should be able to do other things like increase memory without necessarily affecting the warranty. Yes, there are some devices to which you can do little but for those devices that can be worked on, you should have that option. There might not be a lot of aftermarket parts available for some devices at the moment but that could change if the demand for non-factory repair increases due to the awareness of the Magnuson-Moss Act much like in the automotive, truck and other vehicle industries. It is this competition that will help drive down costs to repair these devices.

 

[Abraka]

I wonder if this applies to nuclear missiles. I don't want to buy nuclear weaponry that I can't open and repair myself.

 

[cliffordcooley]

I wonder if this applies to nuclear missiles. I don't want to buy nuclear weaponry that I can't open and repair myself.

You should always start small scale. Try it on a stick of dynamite first.

 

[Sir Sparkles]

Needs to include Apple in there. At this point they'll make changes to their devices to make it impossible/harder to open.

That's kinda what I was thinking. What stops companies from complying with this, but then using super unique and complicated shaped screws so it's nearly impossible to get devices open. They could even change it up with every new model so even if you found a tool to use, it wouldn't work on anything else...etc.

EDIT: Side note, I repair laptops and already see practices like this by big brands. They will hide screws under stickers, add very cheap plastic clips, and even utilize glue in hopes that somebody will break it when trying to do their own repairs. Shady...

Yeah, like MS's Surface range of products. Basically single use devices.

Unrepairable.

 

[wiyosaya]

Where were they twenty years ago. Why are they doing something now? What changed? I can remember cutting them ages ago.

I believe this law was put in place in 1975, so it is more like where were they forty years ago?

 

[wiyosaya]

Most people might be familiar with the Magnuson-Moss Act though its other informal name, the Lemon Law, which is well known to apply to cars. Although the Magnuson-Moss Act has been applied to automobile warranties since its inception, it now appears to being applied to other industry warranties now but it's nothing new in and of itself. While if something in your product fails during the warranty period, naturally you might want to take it back to the manufacturer (or authorized place) for free warranty repair, you (or an independent shop) should be able to do other things like increase memory without necessarily affecting the warranty. Yes, there are some devices to which you can do little but for those devices that can be worked on, you should have that option. There might not be a lot of aftermarket parts available for some devices at the moment but that could change if the demand for non-factory repair increases due to the awareness of the Magnuson-Moss Act much like in the automotive, truck and other vehicle industries. It is this competition that will help drive down costs to repair these devices.

Excellent point!