Let’s face it: none of us are reading the Software License Agreement for the latest Apple iOS update. Why is that the case? Perhaps it is that the language is inaccessible. Maybe people find the content too boring. What we know for sure is that the majority of the population appears to trust that the digital service provider is not asking them to agree to anything that would be unfair. But is that trust warranted?
A recent North American study showed just how easy it is to dupe consumers into blindly agreeing to terms. The researchers invented a fake social media platform and included two “gotcha clauses” designed to show that the users were not reading the terms. The researchers also measured the amount of time that each participant spent reading the terms. The two clauses included one that required users to disclose their information to the National Security Agency (NSA). Another clause required the user to assign their “first-born child” to the company as payment. Shockingly, 98% of users agreed to these clauses. Unsurprisingly, the average time spent reading the terms of service was less than a minute. North Americans simply are not empowered (or bothered) to read their license agreements.
In reality, many Terms of Service are not that long. The English version of the Apple iOS 13 Software License Agreement is only 12 pages. You would think that the legal obligations imposed by this contract and, more importantly, the intimate nature of your relationship with these service providers would be enough to empower you to read a 12-page document. However, this just simply isn’t the case.
Let’s take a look at some of the terms you agreed to when you clicked “Agree” on that last iOS update. Did you know that you agreed that the contract is governed by the laws of the State of California? This type of contractual term is called a “forum selection clause” which allows the company to choose what laws apply to their services and more importantly where you need to bring a claim against them. That means that you need to file with a California court and attend hearings in that state. This is a huge barrier to bringing a legal claim if you are a user outside of California whose country does not protect against these clauses. Most people would not agree to this term if there were any bargaining. However, you can’t bargain with most of these service agreements.
Many other companies make light of the fact that most people will not read their terms. MailChimp includes a force majeure clause that absolves them of liability from “zombie apocalypse”. Apple’s iTunes Service Agreement includes a clause that you agree not to use their music service to build biological weapons. Clearly, companies acknowledge that their terms are not being read yet don’t appear to be doing anything about the issue.
Recently, a travel insurance company called SquareMouth secretly ran a contest called “It Pays to Read”. They wanted to encourage clients to read policy documents. So, they included a term at the very end of the agreement offering $10,000 to the first person to read that far. A teacher from Georgia was the winner. So where do we go from here? How can we empower users to actually read their Software License Agreements without offering a $10,000 prize?
A study conducted in the EU suggests that more consumers read through the terms when they are forced to scroll through them. The study also suggested that shortening and simplifying the terms could lead to a “more positive attitude towards” terms and conditions. Digital platforms can modify their user experience to include clear, concise terms to ensure that their users are actually consenting. Instead of hiding the terms under a mountain of a legal text, platforms can offer clear questions to highlight the most important areas of the user agreements such as privacy statements.
At Bowhead, we try to empower consumers to truly consent by using smart contracts that make clear exactly what we are asking the user to share and giving them a clear option to agree or not to agree. In this way, we are bargaining with our user rather than giving them a take-it-or-leave-it agreement. Although we might not be able to change the consumer’s behavior overnight, we can help empower users to understand their rights and to protect their privacy by making
 The Biggest Lie on the Internet: Ignoring the Privacy Policies and Terms of Service Policies of Social Networking Services, Obar & Oeldorf-Hirsch (2016), https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2757465
 Apple iOS 13 Software License Agreement,
 Apple Media Services Terms and Condition, https://www.apple.com/legal/internet-services/itunes/us/terms.html
 SquareMouth, Pays to Read, https://www.squaremouth.com/campaign/pays-to-read/
 European Commission, Study on consumers’ attitudes towards Terms and Conditions (T&Cs), https://ec.europa.eu/info/sites/info/files/terms_and_conditions_final_report_en.pdf