Thu, Jul 28, 2011 - Page 8 News List

Officials making mess of IT policy

By Shyu Ting-yao 徐挺耀

Apple has complied with the Taipei City Government’s request to provide a seven-day trial period for software bought through its online App Store during which the software can be returned for a full refund.

The city government says that this will protect consumers and has asked all major foreign app suppliers to follow suit. Google flatly refused to provide the trial period for its Android Market, taking down all paid apps from its online store until the matter has been resolved. It looks like Google will be exploring other options.

Clearly, foreign firms are not willing to take these things sitting down, and in the meantime, the city government is endangering the digital content industry in Taiwan.

One thing that is annoying about the online stores of these non-Taiwanese companies is the way they do not seem to cater to customers who use traditional Chinese characters and that many overseas Web sites visited by large numbers of Taiwanese have either poor Chinese interfaces or are otherwise very user-unfriendly. This is what is really at the crux of the issue. It is not so much about whether they allow people to return goods, and one does have to remember that these companies have mechanisms in place that apply to tens of millions of users all around the world.

The main problem is that, because these firms and products do not cater well to Chinese-speaking users and as the company offices are often located overseas, the response to end users in Taiwan is often quite slow. If the services were offered free of charge, there would be little cause to complain, but when Taiwanese users are paying for services they expect to get something in return.

The main thing that differentiates a product consisting entirely of digital content and, say, an exercise bike sold on a TV shopping channel, is the residual value. In the case of an app game, once the user has completed it, he or she is unlikely to want to play it again. Its value is essentially spent. The same is true for an e-book or digital magazine: Once you have finished it, why go back and read it a second time?

With the exercise bike, once you return it you forgo the benefits that can be derived from continued ownership, in terms of getting yourself in shape. There is really no point, then, in selling game apps or e-books when people are just going to be trying to complete app games within seven days, for example. If you can read a Giddens Ko (九把刀) book in a week, why part with your money? You may just as well get yourself a refund.

The Enforcement Rules of the Consumer Protection Act (消費者保護法施行細則), which governs the seven-day trial period, does not make sense for virtual products. The problem is that you cannot sell digital content in a physical store because the product is intangible. What digital products offer you is an experience and they are not something you “own,” short of having them implanted as brain waves. Returning a physical object bought online or in an actual store takes time and effort, unlike applying for a refund for digital content, which is only a mouse click away. This is something which is clearly cause for concern for many companies.

The government has spent quite a lot of money on the so-called digital content industry, perhaps hoping that major local manufacturers such as HTC or Acer are not toppled by the likes of Apple, and core to this is digital products, such as mobile applications. The Industrial Development Bureau says that it alone will spend more than NT$3 billion (US$104 million) before 2013 on promoting digital content.

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