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Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions — A Digital Single Market Strategy for Europe +''"The Digital Single Market must be built on reliable, trustworthy, high-speed, affordable networks and services that safeguard consumers' fundamental rights to privacy and personal data protection while also encouraging innovation. This requires a strong, competitive and dynamic telecoms sector to carry out the necessary investments, to exploit innovations such as Cloud computing, Big Data tools or the Internet of Things. The market power of some online platforms potentially raises concerns, particularly in relation to the most powerful platforms whose importance for other market participants is becoming increasingly critical"'' (p. 9).  +
Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions — Communication on future networks and the internet +Page 7: ''"EC competition rules (Articles 81 and 82 EC) will play a crucial role in preventing and removing anti-competitive conduct. These provisions allow tackling both abusive conduct of dominant network operators as well as co-ordinated conduct aimed at excluding other services or alternative operators from the market"''.  +
Communication from the Commission — Guidance on the Commission's enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings +''48. ‘Tying’ usually refers to situations where customers that purchase one product (the tying product) are required also to purchase another product from the dominant undertaking (the tied product). Tying can take place on a technical or contractual basis.''  +, ''49. Tying and bundling are common practices intended to provide customers with better products or offerings in more cost effective ways. However, an undertaking which is dominant in one product market (or more) of a tie or bundle (referred to as the tying market) can harm consumers through tying or bundling by foreclosing the market for the other products that are part of the tie or bundle (referred to as the tied market) and, indirectly, the tying market.''  +, ''53. The risk of anti-competitive foreclosure is expected to be greater where the dominant undertaking makes its tying or bundling strategy a lasting one, for example through technical tying which is costly to reverse. Technical tying also reduces the opportunities for resale of individual components.''  +,


DRM in Cars Will Drive Consumers Crazy +''"The problem extends beyond inconvenience. In plenty of cases, DRM has led to users losing altogether the ability to watch, listen to, read, or play media that can't be "authenticated." Video games with online components now routinely reach an end-of-life period where the company providing the authentication decides it's no longer worth it to operate the servers. That raises the frightening possibility of a company like Renault deciding that it's not cost-effective anymore to verify new batteries—and leaving car owners high and dry."''  +
Digital Consumers and The Law. Towards a Cohesive European Framework +<u>So, about interoperability: if information isn't provided about lack of interoperability because of standard/format incompatibility or because of TPMs, it is a violation of information obligation according to CRD and a non-conformity of the product according to Consumer Sales Directive; if information is provided, and it is provided in a way that makes consumer's legitimate expectations of interoperability (we may question if an information provided in a way that can't make the consumer's legitimate expectations fall allows the applicability only of the Consumer Sales Directive or also of the CRD, seen that – in the latter – the burden of proof of the compliance with the information requirements belongs to the trader, but it is unclear if he has to prove only the formal satisfaction of the requirement or also the effectiveness of the information provided), these Directives can't help, but the UCP Directive and competition law perhaps can.</u>  +, '''''DIRECTIVE 2011/83/EU on consumer rights (Consumer Rights Directive).''''' Recital 19: ''“Digital content means data which are produced and supplied in digital form, such as computer programs, applications, games, music, videos or texts, irrespective of whether they are accessed through downloading or streaming, from a tangible medium or through any other means. Contracts for the supply of digital content should fall within the scope of this Directive. If digital content is supplied on a tangible medium, such as a CD or a DVD, it should be considered as goods within the meaning of this Directive. Similarly to contracts for the supply of water, gas or electricity, where they are not put up for sale in a limited volume or set quantity, or of district heating, contracts for digital content which is not supplied on a tangible medium should be classified, for the purpose of this Directive, neither as sales contracts nor as service contracts. For such contracts, the consumer should have a right of withdrawal unless he has consented to the beginning of the performance of the contract during the withdrawal period and has acknowledged that he will consequently lose the right to withdraw from the contract. In addition to the general information requirements, the trader should inform the consumer about the functionality and the relevant interoperability of digital content. The notion of functionality should refer to the ways in which digital content can be used, for instance for the tracking of consumer behaviour; it should also refer to the absence or presence of any technical restrictions such as protection via Digital Rights Management or region coding. The notion of relevant interoperability is meant to describe the information regarding the standard hardware and software environment with which the digital content is compatible, for instance the operating system, the necessary version and certain hardware features. The Commission should examine the need for further harmonisation of provisions in respect of digital content and submit, if necessary, a legislative proposal for addressing this matter.”'' Art. 5(1): ''“Before the consumer is bound by a contract other than a distance or an off-premises contract, or any corresponding offer, the trader shall provide the consumer with the following information in a clear and comprehensible manner, if that information is not already apparent from the context: (...) (g) where applicable, the functionality, including applicable technical protection measures, of digital content; (h) where applicable, any relevant interoperability of digital content with hardware and software that the trader is aware of or can reasonably be expected to have been aware of.”''  +


European Parliament resolution on the Internet of Things +The Parliament ''"(b)elieves that consumers should be given the opportunity to opt-in or opt-out of the Internet of Things, including the ability to opt-out of individual IoT technologies without disabling other applications or a device as a whole"''.  +


Five Challenges For The Internet of Things Ecosystem +''"Data Sharing: In the Internet of Things paradigm, data is gold. However, data provisioning builds off a social contract between large corporations and customers. Corporations provide a free or nominally-priced service in exchange for a consumer’s personal data. This data is either sold to advertisers or used to develop further products or services useful to consumers. Third-party applications, which build off the core service, poach customers (and related customer data) from such applications. For established networks and large corporations, this can be detrimental practice because such applications eventually poach their customers. In such a scenario, large corporations need to balance their approach to open source with commercial considerations."''  +


Google Glass and the Demise of Ownership +''"Another complication is that Google Glass, like many recent- and emerging-generation consumer electronics products, is made useful largely through its ability to connect to license-based service offerings. When you use a service such as Google Maps, you do so under a license to access the associated content—you’re a licensee, not an owner of that content."'' ''"The model of requiring purchasers of consumer electronics devices to first enter into restrictive contracts as a condition of sale and then to agree to restrictive licenses when using those devices raises multiple concerns. Most fundamentally, it does an end run around legal frameworks that evolved specifically to prohibit anti-competitive and consumer-unfriendly downstream control over transfers of ownership. And it’s confusing for consumers."''  +


How Smart, Connected Products Are Transforming Competition +Local or remote smartness? ''"Once a company has decided which capabilities to offer, it must decide whether the enabling technology for each feature should be embedded in the product (raising the cost of every product), delivered through the product cloud, or both. In addition to cost, a number of factors should be taken into consideration"'': response time (if there is need for a quick response time, it is better for the software to be embedded in the product: in this way, we should also avoid that lack of connectivity slows down response); automation (fully automated products usually require that greater functionality be embedded capabilities); network availability, reliability, and security (embedding software minimizes dependence on network availability; moreover, if data doesn’t have to move from device to cloud or vice-versa, there are less threats to data security); location of product use (when the products are locate din dangerous locations, remote storing of data could be a good idea); nature of user interface (if it is complex and changed frequently, it is better to locate it on the cloud); frequency of service or product upgrades (when we have cloud-based interfaces and applications, upgrades and changes can be made easily and automatically).  +, Open or closed system? In the IoT world, we often have ''"systems encompassing multiple products"''. If the firm chooses a closed system, this approach is normally aimed to have customers purchase the entire system from it (<u>technical tying</u>): ''"(k)ey interfaces are proprietary, and only chosen parties gain access"''. If, on the contrary, an open system is chosen, the end customer is enabled to assemble the parts of the solution (both the products involved and the platform that ties the system together) from different companies: ''"the interfaces are open and standardized, allowing outside players to create new applications"''. ''"Closed systems create competitive advantage by allowing a company to control and optimize the design of all parts of the system relative to one another. The company maintains control over technology and data as well as the direction of development of the product and the product cloud. Producers of system components are restricted from accessing a closed system or are required to license the right to integrate their products into it. A closed approach may result in one manufacturer’s system becoming the de facto industry standard, enabling this company to capture the maximum value. A closed approach requires significant investment and works best when a single manufacturer has a dominant position in the industry that can be leveraged to control the supply of all parts of the smart, connected product system"''. ''"A fully open system enables any entity to participate in and interface with the system. The open approach enables a faster rate of applications development and system innovation as multiple entities contribute. It can also result in a de facto industry standard, but one from which no company gains a proprietary benefit"'' (Philips Hue light bulb is an example). When we have systems of systems, it is difficult to maintain a complete closed system, because often one firm doesn't have the capability of managing the entire system of systems: therefore, her we have firms (for example Whirpool) that try to maintain control on its product features, but enable those products to connect with other systems: hybrid approach.  +


I Contratti di Internet. Sottoscrizione, Nuovi Contratti, Tutela del Consumatore, Privacy e Mezzi di Pagamento +the contract often states that the provider isn't able to guarantee an uninterrupted service, which is an unfair clause.  +


LG Will Take The 'Smart' Out Of Your Smart TV If You Don't Agree To Share Your Viewing And Search Data With Third Parties +The use of most of the smart features of the TV requires the creation of an LG SmartWorld Account: ''"For example, some of our services require that you become a member of LG SmartWorld, which may be subject to separate terms. You may join LG SmartWorld either through your LG Smart TV or by other means, such as through certain LG websites. This Membership Information may include your user ID, password, telephone number, name, date of birth, gender, email address, address, social networking service ID, security question answers, purchase history, and related payment information, such as credit card information or details of your PayPal account and more."''  +


Payment Method Design: Psychological and Economic Aspects of Payments +<u>We may try to apply this research to the current trend of the IoT market, in which - even if there is actually along-time relationship between the provider and the consumer - usually the payment is a lump-sum at the moment in which the consumer acquires the possession of the token that makes the service possible. Among the reasons for the business model chosen, there might be the consumer's ''pain of paying'': paying for the token could be considered the equivalent of a subscription, in which you pay once and for all, and in which therefore consumer's pain of paying is reduced. Businesses should thus prefer this form of payment, because - given that consumers prefer it, rather than pay-per-use (and also, as an intermediary step, periodical fees) - they will more willing to conclude the contract and subsequently to use the product frequently and for a long time. And - considering the fact that often the business model of the firm is focused on the collection of data rather than on the commercialization of the hardware - this kind of approach may be susceptible to foster a greater data collection. The problems are, however, that: 1) when physical objects are concerned, and consumers pay once and for all for them, they think to be able to use them permanently: even if the free paired service ceases to be provided after a period long enough to reward the sum paid for the hardware, consumers will claim against the supervened unusability of the product; 2) even if, unofficially, the sum is paid for the service, officially it is paid for the token: therefore, if the service ceases to be provided before a period of time sufficient to remunerate the lump-sum paid, nothing will be returned to the consumer, and usually the standard terms accompanying the product even state that the service could be discontinued at any time and for any reason. Someone may complain about the fact that, in the adaptation of this study to the IoT world, I have approached the periodical fees to the pay-per-use, considering the fact that - in traditional services - the opposite of pay per use is subscription (i.e. periodical fees; think about the flat rates paid to network operators). But traditional services have from the start been considered as "services", where the alternative payment methods could be subscription and pay-per-use (even in the world of contracts for Internet provision, where we have a service + a token - which is the router -, the router has always been seen as a tool to access the service); on the contrary, when dealing with the IoT, the products concerned are traditional items - which have always been subject alternatively to sale or rental - that suddenly become smart and susceptible of providing services: therefore, in consumers' view, the payment method consisting in periodical fees is not the payment method that reduces the most the pain of paying, because there is a further method which causes lesser pain, i.e. a lump-sum paid once and for all.</u>  +