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FTC And PC Rental Companies Settle In Spying On Users Case

Unknown Lamer posted about a year and a half ago | from the just-when-ubuntu-was-about-to-sign-up dept.

Security 80

SternisheFan writes with news of a settlement in a case of Rent-to-Own firms grossly violating the privacy of their customers. From the article: "Seven rent-to-own companies and a software developer have settled federal charges that they spied on customers, ... The companies captured screenshots of confidential and personal information, logged keystrokes, and took webcam pictures of people in their homes. Their aim was to track the computers belonging to customers who were behind with their payments. 'An agreement to rent a computer doesn't give a company license to access consumers' private emails, bank account information, and medical records, or, even worse, webcam photos of people in the privacy of their own homes,' says FTC chairman Jon Leibowitz. 'The FTC orders today will put an end to their cyber spying.' Developer DesignerWare produced the software that was used to gather the information, PC Rental Agent. The package included a 'kill switch' designed to disable a computer of it was stolen, or if payments weren't made. However, an add-on program called Detective Mode could log key strokes, capture screen shots and take photographs using a computer's webcam, says the FTC in its complaint (PDF)."

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lengths companies go to (0, Troll)

56ker (566853) | about a year and a half ago | (#41462705)

Well it just goes to show the lengths some companies will go to in the persuit of profit.

Re:lengths companies go to (-1, Troll)

Anonymous Coward | about a year and a half ago | (#41462757)

What the bloody hell does this have to do with profit? You people are such infantile fools. Isn't there an OWS rally you are supposed to be at?

This is a violation of the law, what I want to know is why, assuming these things are true, do we not see people in jail?

Re:lengths companies go to (0)

Anonymous Coward | about a year and a half ago | (#41462897)

It goes back to the profit thing. This country is built around the concept of amassing power, and money (profit) is one form of power.
These people use some of those profits to ensure they don't go to jail.

As for how this is related to profit - it can reduce the risk of financial loss, which with a large enough sales/rental base, becomes a percentage overhead cost. They can then use this to lower prices below the competition, and increase sales/rentals, while still, hopefully, keeping the same per-unit margins.

Add into that marketing information (either directly used, or sold to advertisers), and other ways of using this information, there are loads of ways to use this for profit.

Re:lengths companies go to (-1)

Anonymous Coward | about a year and a half ago | (#41463149)

"This country is built around the concept of amassing power"

OMFG, keep talking drone I needed a laugh this morning.

"We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security."

Ya, that's all about profit.

It has everything to do with profit. (1)

logicassasin (318009) | about a year and a half ago | (#41467331)

This is similar to used car dealerships that use PassTime [passtimeusa.com] , whereby a person that doesn't pay for their car on-time can't drive it and, thanks to the built-in GPS, the person constantly has their whereabouts tracked. This is done purely to keep the money rolling in, hardship be damned.

Re:lengths companies go to (5, Interesting)

fuzzyfuzzyfungus (1223518) | about a year and a half ago | (#41462863)

Well it just goes to show the lengths some companies will go to in the persuit of profit.

Worse, it demonstrates the incredible toothlessness of the penalties for doing so, as long as you do it correctly(the fact that the victims of sleazy rent-to-own places aren't exactly people who matter or are likely to lawyer up very effectively)...

I suspect that there's a reason why societies that frown on and/or execute usurers have historically been so common.

Class action (2)

phorm (591458) | about a year and a half ago | (#41466909)

It's also a good reason why clauses blocking class-action are bad, and should be illegal.
People in these sort of situations generally CAN'T afford a lawyer to fight the abuse that IS happening. However they can form a class action. They might not get compensated financially, but they can punish the offending company and force them to clean up their act.

Re:lengths companies go to (3, Insightful)

CastrTroy (595695) | about a year and a half ago | (#41462901)

I wonder how there is even a market for laptop rentals in today's society. First, a laptop can be bought flat out for $400 and that will get you a not too bad laptop. On top of that, most computer stores will offer some kind of financing. I know a guy who worked at Futureshop. He said he was quite amazed how bad the credit ratings were of the people they gave out store credit cards to. You can go to dell right now and get a laptop for $15 a month. I don't see how any rental company could compete with that.

Re:lengths companies go to (2)

h4rr4r (612664) | about a year and a half ago | (#41462995)

I bet the people these place prey on do not know that.

You can actually get a reasonable machine for less than $350, refurb for maybe $100 less.
Yes, they really are that cheap now.
http://www.newegg.com/Product/Product.aspx?Item=N82E16834246633 [newegg.com]

Re:lengths companies go to (2)

Reverand Dave (1959652) | about a year and a half ago | (#41464131)

I bet the people these place prey on do not know that.

That's pretty much the foundation of these rent to own business. That's why they are set up primarily in low income neighborhoods. People think they are getting a good deal by paying $10 a week for their TV but end up paying 200% over what they could have got it for otherwise.

Re:lengths companies go to (0)

Anonymous Coward | about a year and a half ago | (#41466527)

No - people 'think' :

Aw crap - I have only $10/paycheck extra. And it will take me 2 years to save up for this TV.
In the meantime, they are eating not enough / crappy food to be able to save that $10,
want to do something 'fun' (like go to mcdonalds instead of eat rice & beans 1x every 2 months),
so there is no way they will last 4 months without blowing the $60 it took them 3 months to save,
let alone 2 years, so might as well sign up someplace where you *have* to pay that $10
so that you are forced to 'save it' for the TV, and even though you are paying 2x the price,
at least you will have it eventually.

They know they are being ripped off, but it's either: get ripped off, or dont get it at all.

This is the actual formula. If they could save it, they would, but they don't have that kind of bourgeois
proprietary 'oh I feel like it' capability that you do, while you look down at them

Re:lengths companies go to (1)

dubbreak (623656) | about a year and a half ago | (#41464535)

I bet the people these place prey on do not know that.

That's exactly it. They don't know better and can't figure out how much a rip off the place is. Places like Aaron's charge maximum interest rates on products that they price well above the norm for the market. The box stores are selling a particular tv for $800? Aaron's claims it's worth $1200 (which should be the original msrp, if not they could get sued like a bunch of the payday loan places did in Canada for charging interest that is effectively above legal levels). They make it sound good by having ridiculously long terms so the monthly rate is low(ish).

Why do people go to payday loan places instead of running a line of credit? Some people might not be eligible, but I suspect the majority don't know any better. Most credit card companies offer better rates on cash advances than payday loan places. If you can't get a credit card why would a payday loan place loan you money? You are probably too high a risk for any type of loan regardless of the payback.

I think why these places can even exist is education. I had to help teach a friend about compound interest and how paying the minimum monthly payment on her credit card would not reduce her bill ("But I only have to pay $10!"). Huge credit card bills combined with 60K+ in student loans and a car lease but she had no clue about the costs of borrowing. So many people are "credit rich" and don't have a clue about how much it will cost them to use that credit. To them a 10K limit on a credit card is like having a bank account with 10K in it. You or I wouldn't think of it that way, but plenty of people do.

Re:lengths companies go to (1)

ewibble (1655195) | about a year and a half ago | (#41466653)

I once saw a pay day loan advertise there interest at only 8% per week, yes they used the word only. If it was compounded weekly that's about 5370% per year (1.08^52)-1*100, even if it wasn't it's still 416% p.a

They are con artists that use peoples lack of knowledge to screw them over.

Re:lengths companies go to (1)

dubbreak (623656) | about a year and a half ago | (#41466955)

I assume that's the US as that's way beyond what's legal in Canada (yes even 416%). A bunch of pay day loan places were taken to court over having the maximum interest rate but also charging various service fees. It was deemed that the service fees were effectively pushing them over the max interest rate (as it was just another cost on borrowing money no matter what you call it).

Even new car dealers are in on it. A local Mazda dealership listed 0%* on purchase (probably listed nationally even). If you read the footnote the effective rate is 7%. Why? They give you a discount for paying cash. So you are better off to find your own financing for less than 7% (I can walk into the bank and get better than that) so you can pay "cash" and get the $5000+ "discount". You're average person will say, "Oooh, no down and 0% financing.. this is a good deal!" Then end up paying way more in interest than necessary.

I guess it's true that "A fool and his money are soon parted". It's too bad the law doesn't do a better job of protecting the less educated.

Re:lengths companies go to (1)

g0bshiTe (596213) | about a year and a half ago | (#41468095)

I know places that charge 20% and up for used car loans.

Re:lengths companies go to (1)

dubbreak (623656) | about a year and a half ago | (#41471815)

I know places that charge 20% and up for used car loans.

Yeah we have some of the slime ball, "No credit? No problem!!!" type places. Even at a normal interest rate by the end of the loan they could have gotten a new vehicle.

I had a new car dealer try to pull the bullshit four-square worksheet [edmunds.com] on me. That's old school and lame. They claimed to not do the whole dance, then won't give me an out the door price and pull the lame old school, "Well how much do you want to pay per month?" I don't care. I'll figure out financing. You said I could have the one for $21K out the door (which you have conveniently forgotten and never wrote on paper), will you do the 4x4 model for $24K or not? I ended up buying from a dealer that I made an email offer on a new vehicle. Came in, signed some papers walked out in less than 20 minutes owning a new car. Worked out great for everyone.

Re:lengths companies go to (1)

Anonymous Coward | about a year and a half ago | (#41463013)

Because 1) you're priviledged, and 2) there are poor people in the US, believe it or not. Yes, poor enough to live paycheck to paycheck who have a hard time paying the bills. Why need a computer? Ever seen those "work-from-home" ads? Medical transcribers? Yeah, they need a computer.

In Atlanta we have Aaron's which is owned by Charles Loudermilk. That guy is friggin' rich. Obviously there's a market for rental, especially if you're transient moving between apartments across cities (wherever the jobs are). It's pointless to own furniture and the like.

But to the main point of my post. People who rent are not so responsible for things that are not theirs. Large flat screen tvs they rent for that one NFL game with friends get bashed. Lastly, laptops get stolen because they're very portable/ mobile. Just like the transient lifestyle.

Re:lengths companies go to (0)

Anonymous Coward | about a year and a half ago | (#41463887)

If you are renting a PC, you need at least an income of $15-20 a month (that's the rental price I've seen). If you have $20 a month to spare, you aren't living paycheque to paycheque (I should know, I've been there).

Not to mention if you have $20 a month to spare, you can buy a computer on a 2 year payment plan. As the earlier poster said, you can get a payment plan/store credit card with terrible credit. $20 a month will easily buy you a $400 machine, however, you can get laptops for $250 on sale (Even saw one for $225 the other day), so you could actually get your payments down to $10 a month.

In other words, renting a computer costs you more the first payment you make.

I just can't figure it out... And I spent a few months earning $400 a month this decade, so yes, I understand being desperate for money.

Re:lengths companies go to (0)

Anonymous Coward | about a year and a half ago | (#41463597)

How about $250.

http://microcenter.com/product/386509/2000-425NR_156_Laptop_Computer_-_Charcoal_Gray

Half the cost of the bottom of the line iPad.

Re:lengths companies go to (0)

Anonymous Coward | about a year and a half ago | (#41468877)

How about: http://www.dealextreme.com/p/v702-7-0-lcd-android-4-0-netbook-w-wi-fi-camera-lan-hdmi-sd-slot-pink-154852

Less than the cost of two tanks of gas, or a month's fast food :D

Seriously though, if somebody *NEEDS* tech it's doable for a lot less that used to be assumed.

Re:lengths companies go to (1)

MobyDisk (75490) | about a year and a half ago | (#41465029)

And renting is harder too!

Years ago, I had a business trip coming up very quickly and I only had a desktop. I thought I would try renting one. The hoops I had to go through were ridiculous: a stack of paperwork, credit check, background check, multiple credit cards, signatures from references. About half way through I politely told the person behind the counter that this really wasn't for me and I would just go buy one. I can only assume that they get an amazing amount of fraud.

Re:lengths companies go to (1)

Stan92057 (737634) | about a year and a half ago | (#41465203)

Your assuming everyone is like you and has good credit like you and a great paying job like you that allows you put a 400.00 laptop on a credit card or just plunk out 400.00 at sale. Alot of people have bad credit alot of people are what i call the working poor. There are just not enough manufacturing jobs where the less then educated can work. There are alot more people out of work then you think.

Re:lengths companies go to (1)

shemyazaz (1494359) | about a year and a half ago | (#41465599)

I come from a poor family. My brother is still poor (despite my attempts to help him). Even when not working and living primarily on government benefits he is capable of finding the money to party. This seems to be common amongst the poor. $300 for a laptop wouldn't be a big problem if the proper priorities were in place and some saving was done. But I suppose the inability to do those things is at least in part related to the reason they are poor in the first place.

Re:lengths companies go to (0)

Anonymous Coward | about a year and a half ago | (#41465775)

I think you completely ignored the part where his friend was "amazed how bad the credit ratings were of the people they gave out store credit cards to."

Yes, but... (1)

K. S. Kyosuke (729550) | about a year and a half ago | (#41462803)

...does that stuff run in Linux? And if it doesn't, should I complain about reduced quality of service? I feel discriminated against!

Pfft, more bureaucratic ass-talk (1)

Type44Q (1233630) | about a year and a half ago | (#41462809)

The FTC orders today will put an end to their cyber spying

New! Regulatory hot-air with built-in enforcement!

They probably just had good lawyers (3, Interesting)

adosch (1397357) | about a year and a half ago | (#41462829)

I've never personally used a rent-to-own service, but I can't imagine it's much fun when your marketed crowd is people who can't afford things outright, then specifically deadbeats who have zero intention of ever buying it and will go to great lengths to try and keep your merchandise.

But there's some shady about this whole story that just doesn't make a lot of sense. Why on earth would a rent-to-own company have a whole development team designing all this for them? I think there was a bit of wrongful intent on the company to want to try and steal some PII; maybe not use it themselves, but sell that information, sure.

Now being tied up with a legal battle, it's now easy for their lawyers to pull out the scapegoat that it was all about protecting their investment and assets. As much as I buy that, that's what the repo-man makes a living for. And if you're losing that many computer assets of non-payment or delinquency, then start selling bottom-line PCs and bring some pimple-faced Best Buy let-go in to oversell and dramatize the hell out of them for you. Or better yet, just stop selling them altogether.

Re:They probably just had good lawyers (1)

h4rr4r (612664) | about a year and a half ago | (#41463305)

I wonder if maybe they were making a little extra scratch selling browsing history or something. Still seems like this software goes to far for that though.

Re:They probably just had good lawyers (1)

Reverand Dave (1959652) | about a year and a half ago | (#41464203)

The whole racket is shady as fuck from top to bottom, would you really be surprised to find out they were up to no good with this data?

Re:They probably just had good lawyers (1)

Stirling Newberry (848268) | about a year and a half ago | (#41464605)

Having worked in revenue assurance, the largest classes of dead beats are the elderly and small business owners. The number of actual dead beat dead beats out there, is fairly small. Since utilities have to provide, by law, to virtually every one, and virtually everyone need at least one of gas or electricity, this isn't an anecdotal sample.

Re:They probably just had good lawyers (0)

Anonymous Coward | about a year and a half ago | (#41469157)

Judging by the small business owners I know firsthand (either family-in-law, or friends) I can definitely attest to this. Hell one guy I know who was making bank at his family's store (now owns his own business), would shoplift for fun.

Point being just because you have more than the other guy doesn't mean you use it responsibly (nor in fact use it at all if you can find a better way to 'attain' what you want.)

Most of them also enjoy cheating the taxmen, be it off the books pay, illegal workers, unreported income, overreported losses, whatever.

So they have to stop breaking the law. (1)

slackware 3.6 (2524328) | about a year and a half ago | (#41462835)

But where are the penalties for breaking the law? Bad boy don't do it again just isn't good enough.
And the fake registration scam, wouldn't that be considered malware?

Renting a Computer? (5, Insightful)

Sponge Bath (413667) | about a year and a half ago | (#41462887)

In the age of new $400 laptops, who rents a computer for home use? Rental companies (furniture, appliances, etc) are like payday loan companies: their sole purpose is to prey on the poor and uninformed. The profit is in penalties and reclaiming the product to lease to the next sucker. These transactions are designed to fail and trap the unsuspecting.

Re:Renting a Computer? (0)

Anonymous Coward | about a year and a half ago | (#41463021)

Believe it or not, not everyone walks around in $50 jeans with a $600 smartphone in their pocket. There is a large portion of the population in the U.S. that cannot afford to purchase even an "inexpensive" (that term is relative) computer. That gap is closing every year as the technology becomes cheaper, but we still have quite a way to go.

Re:Renting a Computer? (4, Informative)

dsvick (987919) | about a year and a half ago | (#41463241)

You're absolutely right, not everyone has the cash to purchase even inexpensive things outright, however, going through the rental companies is an absolutely horrible idea. I've never rented from one myself but was close quite some time ago when my girlfriend of the time and I were thinking of renting one of those cool video cassette player things... Even with their rent to own programs the amount of money you will end up spending is often three or four times the cost of the buying the product outright. Sure it is spread over time but even then the payments are not as low as you may think.

Have you ever seen any of their adds, did you notice how inexpensive it all sounds, a computer rental for $8, a desk for it for $4, even a nice comfy chair for a few bucks more. However, if you look at the small print, these prices are the weekly rates, by the time you total it all up and add in whatever other fees they tack on, I would bet you're at the point where you could save your money for a few months and go buy your own.

They suck you in with the glossy adds and the seemingly low rates, then when you find out the truth your sitting in the store with the shiny new PC in front of you and it's quite hard to turn down. After all, you only need to pay the rental for a year or two and it'll be yours. People that get sucked into these things and the payday loans are just widening the gap you mentioned

Re:Renting a Computer? (1)

Stirling Newberry (848268) | about a year and a half ago | (#41464617)

In another age, they would have been outlawed, since they aren't actually making a profit, but dumping the cost of strip mining poor people on to others. This really is a zero sum game.

Re:Renting a Computer? (0)

Anonymous Coward | about a year and a half ago | (#41465389)

The point is that you do it *BECAUSE* DO NOT HAVE A CHOICE.

There is no arguing here. Maybe you are rich enough not to care, but for many people, it's either rental, or nothing. And nothing usually means something like losing your job or home. (Yes, it does. I've been there more than once!)

Nobody does it because he likes it! (Unless you include lobotomised monkeys maybe.)

Example: Apartments: Of course I would rather outright buy the thing! But I cannot even remotely afford to *buy* a apartment, let alone a house. I rather die than get a loan, and even if I would, I couldn't.
So I either rent this shitty overpriced apartment (the cheapest that even fits my bed, desk, couch and closet), or I'm out on the street. Yay, what a choice!

People that ignorant should be made to pay for what they think people like me are supposed to be able to afford.

Re:Renting a Computer? (1)

poetmatt (793785) | about a year and a half ago | (#41463429)

Of course not, nobody does. They walk around with a 1 penny subsidized smartphone, supposedly priced at $600. That's the issue with calling it a $600 phone in the first place. If it's subsidized so heavily it's not reflecting on the real price at all.

People haven't caught on to the clothing store "everything's on sale!" concept where things are marked up 20% and then discounted the same amount but advertised as on sale. It applies to the pricing of smartphones, which carriers have been slowly but steadily inflating over the past 10 years.

Re:Renting a Computer? (1)

Anonymous Coward | about a year and a half ago | (#41463749)

I work with poor people every day. They don't have subsidized phones, they have pre-pay and it's active when they have the money and its off when they don't.

Re:Renting a Computer? (0)

Anonymous Coward | about a year and a half ago | (#41463095)

My company does. We travel all over the country for our meetings and we can't lug 40+ computers for the Internet center. It's a massive rip-off - $100 to rent a 21" monitor but it's better than buying it, keeping track of inventory, plus shipping charges, insurance, etc.

Re:Renting a Computer? (5, Informative)

ledow (319597) | about a year and a half ago | (#41463185)

As someone who has, quite literally, had to tear the sofa apart to find enough pennies for the cheapest loaf of bread in the shop so my girlfriend and I could eat that week, ONLY IDIOTS.

I've been in very undesirable financial positions both through faults of my own and not, and I tell you that I never once rented an appliance or gadget. Lots of companies have the same kind of "penalty" for not having money, starting with banks for instance. That's not the problem here - the problem is IDIOTS who rent an unnecessary gadget.

Firstly, they are among the FIRST things you give up on and sell off. Honestly. They are not a necessity, and if you can afford the money to keep a broadband connection going, you're not desperate enough to rent a machine to run on it. TV, PC, phone. Get rid of them. If you haven't, you're not "in trouble", you're just temporarily "skint/broke" which is another thing entirely.

Secondly, if you have to rent one, you have to work out how much it costs and it ALWAYS costs you more to rent rather than buy outright (like any of those "pay weekly" catalogues and anything else of that nature). Hell, from some places, it's cheaper to get a loan on an item of jewellery (and even just one of those pay-day) and pay back the loan+interest than it is to rent or even lease a PC.

Thirdly, if you're in that position, and you do think you NEED to RENT a LAPTOP for whatever reason, you're an idiot. You can save money by going to the library and using theirs.

If you can't do that, take up an old PC from a boot sale or ask companies/schools that are throwing them out. Hell, you'll learn Linux rather than pay £200 Windows tax on a machine if it actually mattered. But, again, you don't really need a PC and if you do, you "need" an Internet connection much more for half the reasons those type of people state (e.g. "saving money on energy suppliers", etc. - you will NOT save enough money to buy a laptop and always-on connection, so don't give me that crap).

But a laptop, especially, is not required - if your job requires you to have roaming access from anywhere, they will pay for it. The only reason to have a laptop over a PC is absolute necessity for the task at hand (and thus will be provided), or complete narcissism. They are more expensive, less durable, less powerful and more expensive to repair.

I have little sympathy for those who rent such things, or even those who rent basic appliances. What sympathy I have is only for their intrusion of privacy, not for their situation.

My mum rented a TV for 30 years (different models, but basically the same rental) until one broke once and the company gave us hassle, and my brother and I worked out how much we'd spent on it. It was enough to re-buy a new TV every two years over that period and still have money left over. We'd quite literally have had 15-20 fully-working TV's (even after accidents, breakages, etc.) somewhere in the house if we'd put the same money into a box and bought a TV whenever it was enough.

The TV went back and we bought a new TV the same day, which last 5 years until dad changed it for another one for the price of what would have been 1 years rental (and there was nothing wrong with the 5-year-old one either and went to my brother's house).

Renting appliances is stupid. Even renting houses is stupid but that's an order of magnitude more expensive and buying a house requires a credit history and, thus, you can see that not everyone will ever be able to buy rather than rent. But renting, you are just pissing your money away and paying off someone else's mortgage for them, plus 10%. And, yes, I rented for many years.

Renting cars? You're insane. Renting appliances? God, shoot me now.

Everybody: If you find yourself renting objects because you "can't afford it", if you find yourself paying into Christmas clubs because "you can't afford it", if you find yourself signing contracts for monthly payments because "you can't afford to buy it" and then try to claim you have no money - I have zero sympathy despite myself having been in the worst financial situations a person can find themselves in.

Literally, none. It's not a question of being poor, it's a question of being as thick as two short planks with what little money you do have left. The penalties barely matter when the rental is enough to buy the product you're holding, and run a company to rent it out to people, including insurances and losses from those who steal the item in question, and still turn a profit.

P.S. if you're living on benefits and still smoke, I could possibly have even LESS sympathy, but it's a close-run thing.

Re:Renting a Computer? (2)

vlm (69642) | about a year and a half ago | (#41463515)

But renting, you are just pissing your money away and paying off someone else's mortgage for them, plus 10%.

Especially during the bubble, but still in many locations, it does not work like that. Usually renting is cheaper than owning.
Its been a decade+ since you can profit by renting money from the bank vs renting a house from a loanowner.

Housing market is still controlled by speculators. When (if?) investors take over, then you'll be able to buy for less than renting.

Its not much different than stocks. When you hear "dotcoms only go up" just like "house prices only go up" and people buy purely on hope of speculative gains, then talking about the rules of Graham and Dodd style long term value investment is pointless.

Fundamentally, "cash worth one house" and "one house" are equivalent, correct? So why would renting one, be a better deal than renting the other? Or rephrased, imagine I had enough money in the bank to buy a house... why would I invest it in privately owned bank stock and have the bank loan it, rather than just buying a house with it...

Re:Renting a Computer? (2)

CastrTroy (595695) | about a year and a half ago | (#41463591)

I agree with everything you say, except the part about laptops being more expensive. Compared to a desktop, complete with a screen, mouse, and keyboard, you would probably pay more for the desktop. You can get a netbook for $200 [futureshop.ca] . That's good enough to send a few emails, browse the web, write up a resume and find yourself a better job. Plus you can carry it around, which means that you can go to the public library, coffee shop, or McDonald's and use their internet connection so you don't have to pay for that either.

Re:Renting a Computer? (1)

operagost (62405) | about a year and a half ago | (#41463623)

Well, I might agree that leasing a car is stupid for most people, but that's not the same as RENTING one, which is a necessity for most airline travel.

Re:Renting a Computer? (2)

jeko (179919) | about a year and a half ago | (#41465911)

I suspect the poster is talking about a long-term auto lease, which is a notoriously poor financial decision, as opposed to renting a car for a few days.

Re:Renting a Computer? (1)

DocSavage64109 (799754) | about a year and a half ago | (#41464069)

Last time I looked at the cost to rent from Rent a Center some 20 years ago, I calculated that the amount spent to rent-to-own would be about 3 times the price to buy the item. I never looked again since. And I agree. These stores are just preying on the ill informed.

Re:Renting a Computer? (1)

jjhall (555562) | about a year and a half ago | (#41470431)

About 15 years ago I checked into renting a stereo VCR (these weren't all that common yet) to copy some VHS tapes. We had one stereo and one mono in our house. All I wanted to do was rent the machine for a week. By the time I would have paid the initiation fee, the 3 month minimum rental fee, and some other charge I don't even remember now, I was $25 away from going out to the electronics store to buy one brand new. In the end I decided to just go buy one and I gave away our older mono deck to a friend who didn't have a stereo TV anyway.

I learned a lot about how those places work that day. It was my first and only experience trying to rent from one of those places. Since then I've had numerous friends and some family members mention wanting to go rent a couch, or washer/dryer, etc. I've set each of them down, shown them the math, and proven that they could do without for 4 months, save what their weekly payments would have been, and outright bought the item at a regular furniture or appliance store. Most of them did just that, but of course there were those who "couldn't wait" and did it anyway. The only use I have for rent-to-own stores now is sometimes you can get a *screaming* deal on a return if it is a model or two behind the current stock. Nobody coming in to rent an item wants last year's TV when they can get this year's for only a couple of dollars more (per week.)

Re:Renting a Computer? (2)

Paradise Pete (33184) | about a year and a half ago | (#41464351)

Even renting houses is stupid

That's hardly a universal truth. Setting aside that renting in the US would have paid off handsomely in the last half dozen years, in many parts of the world renting make more sense.

In my own situation I pay ~US$320 a month for a modest three bedroom home. I could buy the house. The owner wants ~US$96,000. Why in the world would I buy it when I can rent it for a third of a percent of that?
(and that's the norm. The owner's asking price and rent are in line with the market as a whole).

Re:Renting a Computer? (1)

TheSpoom (715771) | about a year and a half ago | (#41464743)

Why in the world would I buy it when I can rent it for a third of a percent of that?

While that is a pretty good rent for such a house, the answer is that you could mortgage it over 20 years or so... *does back of envelope calculations* for about $700 a month, and have at least some of your money build equity. That means you're ultimately paying yourself, not your landlord, and at the end you can quit paying and continue living in the house (or sell it and move up). Of course, it all depends on the situation. If you're not planning on living there for a long time, renting can be more practical.

Re:Renting a Computer? (1)

jeko (179919) | about a year and a half ago | (#41465983)

$320/month lease, $700/month mortgage. You'll lose money either to rental costs, or (mortgage interest + mortgage insurance + taxes - mortgage tax deductions). The deciding numbers would be at the end of 20 years, does the equity in the home exceed the value of the $380/month savings you've been banking and investing for 20 years? In some cities right now, the equity is more. In other cities, the investment account is more.

Re:Renting a Computer? (1)

ewibble (1655195) | about a year and a half ago | (#41467751)

Firstly its 4% p.a. (still quite good) not 0.33% (from the grandparent) (maybe per month but interest rates are usually stated in p.a.) but renting a house is a bit different to a computer. You are not paying double the value of the house every couple of years. You have to balance that against the interest (or profit on investment) you would have earnt on the money, the interest rate you have to pay on the mortgage, maintenance, how much the value of the house will appreciate/depreciate .... Sometimes it does make financial sense to rent a house. Also shelter is a necessity, very rarely is a computer.

$10 per week on a $400 computer is 130% p.a. But to be fair a house usually has all of its value after 2 years, maybe more, and as a percentage of value administration may be a lot higher on computer. Renting out a 2 year old computer would be hard, but you can still use it, if you buy it.

From the computer renters point of view it does not make sense. From the point of person renting out the computer, it maybe not that excessive, if you include non-payment, fixed expenses, salaries etc, I would need more detail to say for certain.

Re:Renting a Computer? (1)

Paradise Pete (33184) | about a year and a half ago | (#41476229)

In real estate the back of the envelope calculation is comparing monthly rent to the cost, which is why I used it. In the US 1% is more typical, and I doubt you'd find 0.33% anywhere. In my case, a 4% return *before* expenses is just plain awful. Taxes and maintenance would eat most of that that up, not to mention the opportunity cost. The freedom to cleanly walk away with nothing more than a 30 day notice is worth quite a bit.

Re:Renting a Computer? (2)

shemyazaz (1494359) | about a year and a half ago | (#41468113)

After renting for 30 years you have accomplished nothing. You own nothing. The money is gone. What are you going to do when you are too old and infirm to afford that $320 monthly payment? Buying a house is investing in your own financial future. In the end you will have a tangible asset.

Re:Renting a Computer? (1)

Stirling Newberry (848268) | about a year and a half ago | (#41464689)

"But a laptop, especially, is not required - if your job requires you to have roaming access from anywhere, they will pay for it."

That's simply not the case in this economy, and not just at the bottom. I've done consulting stints for companies making a thick percentage, and the company issued laptop was unusable, as was most of the it infrastructure. The days where companies had to pay the sinews of work, are gone. Just be glad to have a job is the new mantra.

"Renting cars? You're insane."

Risk to capital, in many short term cases, renting makes sense. For example, in many cities, a condo near city center is $300,000, which is an amount that most people do not qualify for a mortgage on.

Re:Renting a Computer? (1)

AC-x (735297) | about a year and a half ago | (#41465387)

Renting cars? You're insane

I disagree. If you use a car daily then yes you'd be better off getting a cheap 2nd hand car, but if you use one for just a few weekends a year then owning becomes the insane choice and renting much cheaper (at least in the UK where you have road tax and mandatory annual safety checks to pay).

Re:Renting a Computer? (2)

Ceseuron (944486) | about a year and a half ago | (#41466519)

I agree with most everything here, except for two points.

First off, car renting is not an insanity. I do own a car, which I take obsessively good care of. In situations where I don't want the mileage, wear and tear, and fuel expenses of my "not-so-fuel-efficient" Mustang GT, I will opt to rent a car. I did it not too long ago for a 350 mile drive (one way) and I'll be renting another car again when I fly for a business trip.

Secondly, renting a house isn't a stupid idea. I've done the "American Dream" routine of home ownership and, after my experience, I will never buy another house again. To sum up my experience in a concise manner, I bought a house back in 2007. Countrywide (now Bank of America) approved me based on my credit score and all that crap for a loan amount of up to $250,000. Not wanting to over-extend myself and preferring to err on the side of responsible home buying, I purchased a home for $155,000 on a fixed rate 35 year loan. The first year or so was good. Then property values started dropping fast. Light speed fast. Before long, the same floor plan I had purchased was going for $74,000 but I kept making my house payment. Then our glorious leaders in government started throwing around this ludicrous notion of "too big to fail". Bank executives ran to Washington DC with hands out and spewing fear mongering prophecies of another "Great Depression" if they didn't receive billions and billions of dollars of government (a.k.a. taxpayer) money. Banks then sat on the money they received, refusing to modify anyone's loan, and foreclosures went through the roof. After all, when you've already been given a shit ton of money as a reward for royally screwing the economy, billions more on top of that in taxpayer funded "insurance" against your garbage loans and toxic assets, why not simply repossess all the homes and profit twofold when the economy improves and you can sell them off at a premium again? Profit!

            I approached Bank of America right around the time similar homes to mine were going for $60,000 and asked for a modification and, over the next year and a half, sent reams of paperwork in for the modification process. I learned all about banks and their new "bait and switch" philosophy fast. Most people have already heard about what happens during the modification process, but basically you send in paperwork and the bank conveniently loses it. If you call about your modification, you get told everything's awesome and they'll let you know soon. Then they tell you a week later that they didn't receive some or all of your paperwork. Or it got lost. Or their dog ate it. And it goes in circles. Even sending paperwork via UPS and FedEx, with delivery confirmation, does no good. About six months into this fiasco, I gave up. I stopped paying the mortgage payment and instead put the money into savings for the next year and I let the bank foreclose on the place. They sold it at public auction for $54,000 when last I heard about it. And, because the state I live in is what's considered a "single action" state where Bank of America only gets one action against a homeowner (e.g. foreclosure), they can't collect the difference.

              So that about sums up my home buying experience and why I think renting isn't an insanity. I've heard all the tirades about how letting them foreclose was a bad idea, that I should have held onto a worthless property and hope I broke even in 20+ years IF the housing market ever recovered, and I can honestly say I just don't care. If what was supposed to happen in a "free market" economy actually did happen, and banks were allowed to fail regardless of their size, and our leaders didn't buy into the fear mongering and sent the banks packing to clean up the mess they created, then I'd have been more inclined to stay in the place. As it stands now, I've adopted a new mantra. If I can't afford to buy it outright in cash, I won't buy it at all. I'll be clearing my financial house of all debt and will no longer take out a loan for anything, nor will I consider using credit cards. I'm just not interested in playing the loan/credit game anymore because I've learned that the only winners are the people who are receiving your inflated monthly payments. It's better, in my mind, to rent a place and let someone else enjoy the fun of a failing housing market, "too big to fail" financial institutions, etc..

Renting a place isn't stupid (2)

Sycraft-fu (314770) | about a year and a half ago | (#41466693)

Buying a home is something that is a good idea, but only in some circumstances. If you don't meet the circumstances, then renting is a good idea since you need to have some place to live. Basically you need to:

1) Be able to afford it. You can nearly always find a rental for less than it costs to buy. If you can't afford the mortgage payments on a normal 30 year fixed mortgage, then owning is a bad idea.

2) Be willing to stay for 5 years or more. Buying costs money. If you buy a house and leave soon after, you will lose money on the deal. You normally need to stay for 5ish years to make it a good proposition.

3) Have the savings to deal with repairs of necessary things that might come up. Depending on your skill and physical ability, some things you can do yourself, but either way you are responsible for repairing your house so you need to be able to do that.

If you meet those criteria, then ownership is a great idea. I have owned my house for about 9 years now and I am very glad I do. But renting can be the right answer in many situations.

Also in terms of cars renting a car for a permanent daily thing is stupid but that isn't how most people do it. Car rental is when you temporarily need a car for something, either because you are in another city or you need a truck but don't own one or the like. It is quite sensible in those cases, rather than buying.

Re:Renting a Computer? (0)

Anonymous Coward | about a year and a half ago | (#41470205)

During my graduate studies I met someone with a reasonable case for renting a laptop: it was cheaper to fly over and rent a laptop for a week than it was to bring his laptop on the plane.

Devil's Advocate, At Your Service (1)

TheSpoom (715771) | about a year and a half ago | (#41463017)

What if the users explicitly agreed to this spying in their rental contracts?

click-through EULAs are invalid and unethical (1)

Thud457 (234763) | about a year and a half ago | (#41463143)

Nobody has time to read all that lawyer-spewn horseshit, not even lawyers. And the lawyers only look at it when they decide they want a way to weasel out of whatever they "agreed" to.
EULAs, along with forcing everybody to accept arbitration just goes to show how rotten our system has become. If you're going to rob me, at least have the courtesy of sticking a gun in my face so I have reasonable cause to remove you from the gene pool.

Re:click-through EULAs are invalid and unethical (1)

TheSpoom (715771) | about a year and a half ago | (#41463167)

Why would it have to be a click-through EULA? I would imagine at these rental places, they actually have to sign honest-to-God on-paper contracts anyway.

Re:click-through EULAs are invalid and unethical (1)

Stirling Newberry (848268) | about a year and a half ago | (#41464731)

There is, still, and just barely, a notion of an unconscionable contract. All contracts that depend on the legal force of society to maintain, goes this old notion, cannot be so unfair as to shock the conscience.

I know, back in the day when we were the people, rather than the billing units.

Encouraging (1)

jeko (179919) | about a year and a half ago | (#41468609)

Glad to see at least one other person remembers this "quaint" old idea.... :-)

Re:Devil's Advocate, At Your Service (2)

vlm (69642) | about a year and a half ago | (#41463321)

What if the users explicitly agreed to this spying in their rental contracts?

Contracts written by lawyers but signed by the illiterate? You're not dealing with educated customers, or even trained customers.

Also there are plenty of "rights" you categorically cannot sign away in a contract. Its not as simple as Disney movie magic where the evil witch can write anything on a piece of paper and once the victim signs it, it has to happen that way.

Also there's usually a lemon law provision. Renting something you know is not private enough to use online for medical and financial transactions equals being ripped off. Thats not a laptop, thats a laptop minus all commerce and privacy. Now if they marketed it as a gaming and (free-)pr0n appliance rather than a general purpose PC, then maybe...

Re:Devil's Advocate, At Your Service (1)

TheSpoom (715771) | about a year and a half ago | (#41463475)

Contracts written by lawyers but signed by the illiterate? You're not dealing with educated customers, or even trained customers.

OK, so at the top of the contract:

"If you do not pay us on time, we reserve the right to spy on you and your use of our laptop."

I think that's obvious enough for anyone, and if they're really illiterate enough that that can't be understood, they can't really enter into contracts, can they?

Mostly I'm trying to come at this from the point of view of the rental company because they'll probably be going through the same thought process. I don't believe what they did is right, but I'm wondering if, given the permission of the users, what they did was legal.

Re:Devil's Advocate, At Your Service (1)

Stirling Newberry (848268) | about a year and a half ago | (#41464749)

People who run stores in the path of the coming riots shouldn't engage in business practices liable to encourage them. It's a bad risk profile.

Re:Devil's Advocate, At Your Service (1)

Jiro (131519) | about a year and a half ago | (#41464887)

The fact that the people renting such things may riot is taken into account in the price of the rental--the rental company charges enough that they'll make a profit even given the possibility of riots (or charges enough that they can buy insurance to compensate them in the event of a riot, which amounts to the same thing). I would imagine that's one of the reason the prices seem like ripoffs in the first place: they know very well that their customers may riot and destroy everything, and they have to charge more to make up for that. Riots aren't free.

Re:Devil's Advocate, At Your Service (1)

vlm (69642) | about a year and a half ago | (#41465183)

OK, so at the top of the contract:

"If you do not pay us on time, we reserve the right to spy on you and your use of our laptop."

No you missed the part of my comment

Also there are plenty of "rights" you categorically cannot sign away in a contract. Its not as simple as Disney movie magic where the evil witch can write anything on a piece of paper and once the victim signs it, it has to happen that way.

If you want, you can write on an apartment rental contract that if you don't pay your rent, the landlord will record your daughter showering and upload the videos to youtube, but that will never hold up in court. Any time you try to trickily redefine common concepts or break traditional rules you're in for a trail of tears in the legal system.

The worst part is at least theoretically the people who's privacy is getting violated are not even necessarily the people who signed the contract, now they're really in trouble. You'd have to add to the contract that only the signer is allowed to use the property... good luck... Using the apartment example that'll get thrown out of court too... Well, I signed that the landlord can upload bathroom videos of my apartment if I don't pay the rent, but my visiting female coworker didn't sign and now she's been uploaded by the landlord... this just isn't gonna turn out well.

For a good time look at what happens to people who try to sell what they call silver "dollars" that aren't govt minted "dollars", or say they're going to shoot a politician but claim they were talking about pr0n money shots or they're taking up amateur photography. The legal system has very little sense of humor about word redefinition games. You rent a laptop, it better be a laptop, not a spycam, especially if its spying on people who have nothing to do with the contract.

Re:Devil's Advocate, At Your Service (1)

ArsenneLupin (766289) | about a year and a half ago | (#41463611)

Now if they marketed it as a gaming and (free-)pr0n appliance rather than a general purpose PC, then maybe...

Careful about marketing it as free pr0n: the thing has a webcam, so you might end up unwittingly "producing" as much porn as you'll watch...

Re:Devil's Advocate, At Your Service (1)

vlm (69642) | about a year and a half ago | (#41465045)

Now if they marketed it as a gaming and (free-)pr0n appliance rather than a general purpose PC, then maybe...

Careful about marketing it as free pr0n: the thing has a webcam, so you might end up unwittingly "producing" as much porn as you'll watch...

And if there's any minors in the house, that's an even bigger problem for the monitors.

Yes, that's certainly the Devil's Argument (1)

jeko (179919) | about a year and a half ago | (#41466713)

What if the users explicitly agreed to this spying in their rental contracts?

Basic Contract Law would disallow this. Contracts are only valid when they are legal, mutual and entered into freely by people capable of a "meeting of minds." Contracts between two people of unequal understanding are void on their face. This is why you can't make contracts with children, the intoxicated or people of unsound mind. This is why the Courts generally protect "unsophisticated investors" from financial cardsharps, and why they take a very dim view of certain types of auto dealers who try to sell cars "as-is." It doesn't even have to be an "unconscionable contract," though I would argue that this case certainly would be. Any contract that obviously has one party taking advantage of the other is void on its face.

Think of it as the "Fair Fight" Principle. The Courts would generally allow Tyson and Ali in their prime to square off and call it "good." They wouldn't allow me to step in the ring with either, even if I agreed to it, because the Courts should not be in the business of providing legal cover to homicide.

Direct your outrage (3, Informative)

onyxruby (118189) | about a year and a half ago | (#41463077)

Direct your outrage on this on to the people who let them get away with this. They settled for no fines or penalties. When the watchers let the scumbags get off with a slap on the wrist the message is clear.

Re:Direct your outrage (5, Insightful)

amoeba1911 (978485) | about a year and a half ago | (#41463307)

What slap on the wrist? There was no slap on the wrist at all, they had to pay no fines, no punishment. I'm not sure how they got away with this.

This is gross invasion of privacy. A slap on the wrist would be a small fine, or some monetary award to their customers... or at the very least a letter of apology to their customers. No, they didn't get a slap on the wrist, they got the equivalent of: "you should stop doing that".

Here's how I see it: you rent a room or house to someone, and install cameras to watch the person doing private things, record all their phone calls... you get caught.... the police come over and say "you should stop doing that" and they leave. There is not even a slap on the wrist, this is simply unacceptable. Who did they bribe to get this?

Re:Direct your outrage (1)

onyxruby (118189) | about a year and a half ago | (#41463401)

You have a point, I'm not sure you could even call this a slap on the wrist. My point was to direct outrage appropriately.

Re:Direct your outrage (1)

DM9290 (797337) | about a year and a half ago | (#41464987)

Direct your outrage on this on to the people who let them get away with this. They settled for no fines or penalties. When the watchers let the scumbags get off with a slap on the wrist the message is clear.

They basically let them off with a warning! No fines. nothing but a promise not to do it again. That is even less than a slap on the wrist.

What they should have done (1)

RobertLTux (260313) | about a year and a half ago | (#41466523)

1 declare all RTO agreements "completed" AND refund all payments made (so the victim keeps the computer)

2 have a third party service the machine and declare BY COURT ORDER that the "spy" software was removed completely

3 the company must file a document stating that any and all files/logs or other records from this software have been deleted from company systems (to include any contractors or any company the information has been disclosed to)

4 all computers rented from this point on must have a highly visible notice as to what kind of monitoring/remote access software has been installed

Carrier IQ, lest we forget (1)

Anonymous Coward | about a year and a half ago | (#41463091)

http://www.youtube.com/watch?feature=player_embedded&v=T17XQI_AYNo

Lest we forget the phone software on HTC handsets that among other things logged keystrokes, captured app usage etc. They denied it, the security researcher showed it logging passwords in into a file, captured SMS's web pages visited, intercepted the location data even if you refuse it to a website etc.. He also points out it has permissions to record audio, read messages, read keys, read the contacts list, web pages visited, even HTTPS page data etc.

http://androidsecuritytest.com/features/logs-and-services/loggers/carrieriq/carrieriq-part2/

Their software on the phone would receive a configuration file, that file would tell it what to log and upload to Carrier IQ's servers. An FOI request to the FBI to obtain the manuals they had on the software was rejected. They confirmed they had operator manuals for it, they wouldn't release them:

https://www.muckrock.com/news/archives/2011/dec/12/fbi-carrier-iq-files-used-law-enforcement-purposes/

So most likely it's a widespread spying app. If the FBI's hands are dirty then it's unlikely you will see a prosecution in this case.

Linux live-CD/DVD/USB anyone? (0)

Anonymous Coward | about a year and a half ago | (#41465225)

That’s what I'd be doing with those.

My simple rule: Never ever use an OS you haven't installed and secured yourself. Either wipe it, or use your own live medium.
(And if you aren't skilled enough, either make pretty damn sure the person doing it is a very trusted personal friend, or stop being a lazy ass and learn that shit! It's so easy, a chimpanzee can do it. You're not a chimpanzee, stop making excuses!)

Is this a Federal case? (1)

Compaqt (1758360) | about a year and a half ago | (#41465277)

Did the rental companies operate in multiple states? I thought most of these rental places were just one-store deals.

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