FTC Report to Congress: Repair Monopolies Harm the Public and the Planet

Bipartisan FTC study confirms that onerous repair restrictions hurt the public, harm the environment, and industry opposition to meaningful reform is “not supported by the record.”

May 7 2021, 1:00pm

A new FTC study has found what many consumers already knew: repair monopolies, heavy-handed DRM, and burdensome restrictions placed on documentation, parts, and third-party repair options significantly harm U.S. consumers, innovation, and the planet. 

The FTC’s full study, first mandated by Congress two years ago, catalogs the numerous ways companies make tech repair cumbersome and expensive. The bipartisan report also shot down most industry arguments against meaningful reform.

“Although manufacturers have offered numerous explanations for their repair restrictions, the majority are not supported by the record,” the FTC said. The agency also noted that industry efforts at self-regulation had fallen well short of solving the problem. 

Advertisement

Whether it’s Sony and Microsoft’s game console repair monopolies, Apple’s relentless bullying of third-party repair shops, or the DRM restrictions John Deere imposes to make diagnosing and repairing tractors a costly headache, a bipartisan backlash has been steadily growing for years, with bipartisan calls for meaningful reform exploding on both the state and federal level.

More than a dozen states are currently considering “right to repair” legislation, and numerous lawmakers have called for a federal law that makes it easier for consumers to gain access to third party repair options, documentation, and tools.

In addition to supporting new state and federal legislation, the FTC said the U.S. government could do a much better job enforcing existing warranty laws, as well as existing restrictions placed on “unfair and deceptive” behavior under Section 5 of the FTC Act.

The FTC’s study validated arguments right to repair advocates have been making for years, including the fact that such restrictions have a disproportionate impact on marginalized and low-income communities.

“The burden of repair restrictions may fall more heavily on communities of color and lower-income communities,” the FTC found. “Many Black-owned small businesses are in the repair and maintenance industries, and difficulties facing small businesses can disproportionately affect small businesses owned by people of color.”

The FTC’s report also confirms that the Covid pandemic “has exacerbated the effects of repair restrictions on consumers,” as hospitals struggle to gain access to the tools, documentation, and parts necessary to repair hardware like ventilators on a timely basis.

The FTC’s study also acknowledged the significant environmental impact created by tech companies that push consumers to buy new products instead of repairing perfectly good hardware. 

Advertisement

The report points to a 2019 study by the European Environmental Bureau, which found that the extension of the lifespan of phones by just one year across the European Union would prevent the release of 2.1 million metric tons of carbon dioxide per year by 2030—the equivalent of taking more than a million cars off the roads for a year.

“Extending the life of consumer products unquestionably delays these products’ entry into the waste stream and reduces the amount of energy used to generate replacement products,” the FTC said. 

Numerous companies across various industries have routinely tried to counter these arguments with claims that broader repair options would cause all manner of irreparable harm.

Apple, for example, dismissed efforts at new right to repair legislation in Nebraska by suggesting reform would turn the state into a dangerous “mecca” for hackers. The auto industry recently ran ads falsely claiming that expanding Massachusetts' existing right to repair law to aid consumers and independent mechanics would only benefit stalkers and sexual predators.

Just this week the Wall Street Journal ran an editorial insisting that a bipartisan push for right to repair reform was a harmful “left leaning” “anti-innovation” agenda that posed significant dangers to human health.

But the FTC’s study found that “there is scant evidence to support manufacturers’ justifications for repair restrictions,” and that the government has a much broader role to play in protecting consumers and fair competition in the marketplace. 

Right to repair advocates were quick to applaud the FTC’s study, but were equally quick to point out the FTC report was only the first step toward broader reform. 

“This is a great step in the right direction,” iFixit CEO Kyle Wiens said of the FTC’s report. “The bipartisan report shows that FTC knows that the market has not regulated itself, and is committing to real action.”

Nathan Proctor, the head of USPIRG's Right to Repair Campaign, told Motherboard that the FTC report was a significant milestone, given there’s a broad coalition of industries and companies, worth $10.7 trillion in total, working in concert to derail right to repair reform efforts on both the state and federal level. 

“It's not every day that the Federal Trade Commission says manufacturers' explanations for their repair restrictions are ‘not supported by the record,’” Proctor said. “We see this report as strongly supporting our argument that there is no real reason for companies to keep blocking repair access.”

Proctor noted that the bipartisan, unanimous FTC report also puts a hole in claims that right to repair is somehow a partisan issue. But he also was quick to note that acknowledging the problem and taking concrete steps to fix it are two different things.  

“The FTC laid out a number of steps, in addition to state right to repair reforms, to stop the real harms manufacturers inflict on the public with their repair practices,” Proctor said. “Given that it took two years and an act of Congress to get the FTC to issue this report, let's hope that some of those actions—like enforcing warranty laws or challenging practices as ‘unfair’ under section 5 of the FTC Act—aren't years away.”

Tagged:

FTC, Right to Repair

More
like this
FTC Formally Adopts Right to Repair Platform
FTC Sues Major ISP for Lying About Broadband Speeds
Biden to Sign Executive Order Granting Farmers Right to Repair Protections
Biden Wants to Give Us the Right to Repair. Now What?
Biden’s Right to Repair Order Covers Electronics, Not Just Tractors
Leaked Apple Training Videos Show How It Undermines Third-Party Repair
There Is No Escape From America's Robocall Hell
McDonald’s Franchises Hack McFlurry Machines to Bypass Sanitization Process