The Uniform Computer Information Transactions Act: Ethical Issues in Software Contract Law

Ethical Issues

There are two main issues brought forward by UCITA: ownership and liability. Regardless of whether UCITA or its opponents are justified, these issues will continue to be important.


Software vendors like the idea of selling software as a license. If they simply gave away software with no strings attached, they would not be able to sell as many copies, because people would get the software for free from their friends. Customers, however, would rather be the sole owners of their software, and not have to worry about breaking a contract every time they use it. Some, especially those of the Free Software / GNU movement, believe that software should not be owned by anyone at all, but its source code should be available to anyone.

The real issue here is that software is unlike most other things that are sold. Like a book, it's primary value is intellectual, not material. But, unlike a book, it is easy to make an identical copy of software without altering the original. It takes a large amount of time to create software, yet it is difficult to see why anyone would spend the time, if they cannot be assured of being paid for it. Licenses are a solution to this problem; they use the law to ensure that software developers will be rewarded for their effort. This is a problematic solution however, because, in order to promote the creation of software, it necessarily restricts how users can take advantage of that software. UCITA does not solve this problem, though it tries to come up with a fair, consistent way to implement the license solution. Ownership of software is an issue that is still highly controversial, and only the future can tell how it will be solved.


If a company sells a customer a product, and that product fails to perform its function or causes damages to the customer (and this is the product's fault), the company is liable. This requires companies to spend the time and money to make sure their products are of sufficient quality to make failures unlikely. However, if the product is software, the UCITA would allow the company to be free from all such liability simply by claiming so in the license.

Some argue that this will lead to faulty products and cheated customers. Others claim this is unrealistic, and fear of bad publicity will force software venders to maintain a certain level of quality. Quality is far more difficult to ensure in software products, however, so to require the same level of liability would hurt smaller software companies who cannot afford extensive testing. When a product is faulty, the the customer and the company both feel some of the damages. The question of who gets hurt more, and what situations determine this balance, is an open one that will require time and experience with software in the economy.


Hans Andersen, Jeff Raymakers, Jonathan Reichenthal
March 2001