legal
TL;DR: The Unroll.me scenario highlights the need for more discussion on legal and TOS
Blowup
A couple weeks ago, NYT journalist Mike Isaac wrote a piece on Uber CEO Travis Kalanick that inadvertently gave legs to another story: Unroll.me. I’m not going to restate the facts of the backlash—you can go to multiple sources to read those. I will, however, point out something that I think was missing from the overall conversation, which I think is important for the tech community to assess as much as anything else about the story.
The exact implications of the backlash notwithstanding, it brings up two main points, both of which are connected, and one of which I’ve only seen any real discussion. In short, here’s why Unroll.me CEO Jojo Hedaya’s apology doesn’t solve the underlying problem:
- It placed all of the culpability on the Unroll.me team, and
- It presented “lack of TOS transparency” as the main problem, while the bigger problem as I see it is a lack of discussion and knowledge of TOS in general.
The first was a misstep because it painted Unroll.me as the villain in the narrative. It’s true: Unroll.me could have been much more transparent about their TOS practices, as plenty of people have already pointed out. In particular, Hunter Walk and Steve Sinofsky presented valid points on this in our tweet conversation. As Hunter pointed out, the company’s suggestion that users simply “Read the TOS” was at best insufficient and at worst callous. Steve also tweeted that trying to write an explanatory text of a contract (TOS) in plain English may well not hold up the same legally. Both are correct. But I also see something deeper.
The Precarious Balance
However, the full, unequivocal admission of guilt left Unroll.me holding the whole bag, while only a portion of any perceivable guilt actually lay with them. The cold reality of the entire situation is that the Terms of Service are there for a reason, and that reason isn’t just to take up space or peeve users when downloading a new app. It’s to protect and indemnify the company against any possible legal action; to assert that the company is in the right, and that some responsibility has to rest with the user.
Is the company always right? No. Is it always clear of indiscretions? Of course not (just look at Uber). But the point is that the TOS exists for a reason. And contrary to what many users might want to believe, that reason is not to please them or give them warm feelings inside. It’s to make sure that the company is legally protected.
But what about transparency? Is that not equally important?
The answer, more and more, is “yes,” it is important. But it’s also important that users don’t conflate transparency—of TOS, for example—with a lack of responsibility on their part.
Legal knowledge shouldn’t be seen as a dark art, and—companies’ TOS should be sufficiently clear so users understand and accept the terms outlined therein. It needn’t be a good/bad scenario—just one where all parties are clearly informed. In the context, the legal concept of “good faith” applies almost without question.
The Real Point
All of this leads up to the real point which should be central to everyone’s perspective: that the tech press and blogosphere should cover legal matters, especially those related to TOS, far more than they already do. I read countless articles and posts, and listen to numerous podcasts on fundraising, user-acquisition and retention, hiring, firing, going public, etc. But for all of that, I see only a handful of posts or podcasts where legal knowledge is discussed with as much vigor and depth as new funding rounds are. Sure, those posts and podcasts exist, but they don’t get tweeted nearly as much in the tech mainstream as others on the aforementioned topics.
Why? Well, frankly, because legal stuff is perceived as boring. It’s not “move fast and break stuff”—it’s “move slowly, and make sure you read every word.” That’s not fun, but it is necessary. The larger lesson one should take away from the Unroll.me incident is that founders, VC’s, accelerators, and tech journalists should all turn around and discuss the Terms of Service as much as any other metrics. After all it’s the legal footing upon which the financial relationship between companies and customers ultimately rests. Well-done TOS should be emphasized just as much as raising a Series C round. After all, many companies won’t even get to Series C, but they for damn sure won’t get to Series A without a rock solid TOS.
Firsthand Experience
I learned this firsthand when I was starting my first company, a music-tech startup. What’s the first thing anyone thinks about when they hear “music company?” Getting sued. And I knew that.
So I read every TOS and license I could relating to music—I read Spotify’s, Apple’s, YouTube’s, SoundCloud’s, and even Rdio’s before they went under. I read every single word, and took notes on where each license and TOS assumed too much responsibility—some of which was unrealistic. And then I made sure that our own license and Terms of Service didn’t invite unwanted legal exposure—I wrote it that way. I knew everything in our TOS, and could run it over, forwards and backwards, in my sleep, to artists, founders, VC’s, or anyone else who asked.
Of course not every person is equipped for feels prepared to write their own TOS. I did, but then again, I can’t code, so we all have our strengths and weaknesses. However, because I spent so much time researching, reading, and refining our license and TOS, I was intimately familiar with everything it said. You don’t need to be a lawyer to prioritize knowing your TOS. This is a massive advantage.
You Should Know Your TOS Forward and Backward, Inside and Out
Knowing what your company does and doesn’t do—what you’re allowed to do as written in your TOS—is an advantage because it’s something you can then share with your users. This gives you power. When you are well-versed in the legal aspects of your company as well as the financial or technical ones, you are able to paint a full picture for your customers and control the narrative that is told. It’s not about being deceptive—I would never advocate for that.
But people feel a whole lot less deceived when they’re able to have a real conversation about what they’re signing. Fear and doubt tend to dissipate when questions are welcomed, and people feel respected as customers and users.
This is what the takeaway should be, and where we focus future discussions. Yes, Unroll.me made some mistakes, and companies should try to learn from them and be open and honest with their TOS and other licensing agreements before anything questionable comes out. But we as an industry should similarly prioritize legal knowledge and versatility the way we do engineering prowess and marketing brilliance. In the end, it’s all required to make and run an amazing company.
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Thanks to Jason Rowley, Nick Abouzeid, Alex Marshall, and Eric Willis for reading drafts of this.
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Find me on Twitter @adammarx13 and let’s talk music, tech, and business!
Adam Marx's Mind 