Remember those warranty stickers we talked about a while back? Those same ones that the FTC found to be anti-consumer and thus illegal really have landed multiple hardware manufacturers in the PC and console markets in hot water.
The FTC announced the crackdown on these dubious practices via letters sent to six companies. The trade and consumer practices organization cited the Magnuson-Moss Warranty Act as grounds for the initial citations. That act prohibits companies from charging more than $5 for a product repair or putting repair restrictions on a device that is covered by warranty. Companies wishing for exception must either provide free parts and repairs, or have been given special permission for another reason.
Under the Freedom of Information Act, Motherboard was able to obtain the names of the six companies put on notice by the FTC. Nintendo, Microsoft, Sony, ASUS, HTC, and Hyundai were all cited.
“This letter places you on notice that violations of the Warranty and FTC Acts may result in legal action,” the letters state in bold. “FTC investigators have copied and preserved the online pages in question, and we plan to review your company’s written warranty and promotional materials after 30 days. You should review the Warranty and FTC Acts and if necessary, revise your practices to comply with the Acts’ requirements. By sending this letter, we do not waive the FTC’s right to take law enforcement action and seek appropriate injunctive and monetary remedies against [company name] based on past or future violations.”
The letters sent to each company are all likely very similar to the one that leaked, both in content and intention. What it means is that within the next month, we could see new services and parts sources pop up from the companies named.
These kinds of laws are a major source of concern for early-adopters, consumers and manufacturers alike. And it isn’t just gaming companies being affected. Elon Musk’s Tesla is a constant source of irritation and expense with it’s anti-consumer practices, which include charging thousands of dollars for repair manuals and refusing service to customers living in states where Right to Repair laws exist in the US.
And while it’s unlikely that these kinds of practices will spread to the gaming space, or affect the share prices and investor attitudes relating to these companies, it’s something gamers need to be watchful for.