I often enjoy watching the “Know Your District” bits done by Stephen Colbert on the Colbert Report. With this in mind, it is important you “Know Your License” – shrink wrap vs clickwrap vs browsewrap agreements. Unfortunately, there isn’t a lick of comedic value associated with any of the three.
Let’s start with the basics. What is a license? In this scenario, we are talking about the contractual agreement between a business and end-user for software or internet related items. The type of license used in a particular situation breaks down as follows.
Shrink Wrap Agreement
A shrink wrap license refers to the license associated with a software program a consumer purchases in physical form, to wit, a package with discs in it. The name of this license comes from the shrink wrap protecting the software. As a consumer, you “agree” to the license when you take off the shrink wrap. Is this approach lacking a certain sophistication? Yes, it is! Fortunately, it is less of an issue as the software industry moves away from physical packaging to downloadable content.
A clickwrap license is an online agreement in which a person affirmatively agrees to something. Consider an app download. As the buyer, you would scroll through the terms of the license and then click an “I agree” button. This act puts the “click” in the clickwrap license name.
A browsewrap license is a license a consumer agrees to without providing an affirmative act of agreement. Consider a blog. Since you are not buying anything, there is no way to manifest a “click the box” act. Instead, the webmaster publishes a link at the bottom of the site that clicks through to the license terms.
The enforceability of a browsewrap license is a subject gaining more attention in the courts. The question is whether the mere placement of a set of terms accessed via a link at the bottom of a site is enough to bind a user of the website? The courts traditionally have held the link approach sufficient but are now trending towards requiring clickwrap licenses.
Why the change? The web is maturing, and sites are expanding their collection and use of consumer information. Judges are also becoming more familiar with how the web works. These factors are leading judges to rethink the approval process for website terms on the web.
And there you have it…probably much more information on licensing than you ever wanted to know. In truth, the license is there to help you as a business person. The license represents your opportunity to dictate terms to the users of your goods or services. You would be a fool not to take advantage of that opportunity, so do not shy away from the subject.
Licensing agreements are highly technical documents whether one is discussing a blog or software product. The answer to the question of what is better – a shrink wrap vs clickwrap vs browsewrap agreement depends on what you are trying to do online. Contact me for a free consultation to find out what you need in your particular situation.
To Your Success!
Richard A. Chapo, Esq.
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