FTC Explores Anti-Competitive Repair Restrictions

At the request of Congress, The Federal Trade Commission submitted Nixing the Fix: An FTC Report to Congress on Repair Restrictions in May, a new report that explores the restrictions companies place on consumers who seek to have their products repaired by third parties—not Original Equipment Manufacturers (OEM)—or to do the repairs themselves.

Companies Limit Repair Options

“When directing the Commission to issue this report, Congress noted that it ‘is aware of the FTC’s ongoing review of how manufacturers—in particular mobile phone and car manufacturers—may limit repairs by consumers and repair shops, and how those limitations may increase costs, limit choice, and impact consumers’ rights under the Magnuson-Moss Warranty Act.’

Congressional interest in the competition and consumer protection aspects of repair restrictions is timely. Many consumer products have become harder to fix and maintain. Repairs today often require specialized tools, difficult-to-obtain parts, and access to proprietary diagnostic software. Consumers whose products break then have limited choices.”

The Impact on Medical Imaging

With its emphasis on cell phones and automobiles, you may be wondering why we’re bringing this to your attention. The report does touch on medical devices in two places. In section VI. RIGHT TO REPAIR ADVOCATES’ ARGUMENTS AGAINST REPAIR RESTRICTIONS, sub-section B. Price of Repairs, “the International Association of Medical Equipment Remarketers and Services, Inc., (‘IAMERS’) noted that ‘some independent servicers maintain diagnostic imaging equipment for $150-$250 per hour. When compared to manufacturer servicing at rates reportedly ranging from $500-$600 per hour (with a four[-]hour minimum), independent servicing may offer a cost-effective alternative to hospitals and healthcare organizations in need of reducing costs.’ According to right to repair advocates, however, many independent repair shops do not have access to replacement parts, diagnostics, and other resources that would enable them to complete the repairs in a cost-effective manner.” This may be especially true with new imaging equipment–just as it’s possible to be trapped in a cell phone manufacturer’s “ecosystem” and reliant on their service network, so it is with many imaging equipment manufacturers.

In section VIII. IDENTIFICATION OF ISSUES TO BE CONSIDERED IN ANY ACTION TAKEN BY INDUSTRY, POLICYMAKERS, OR LEGISLATORS, sub-section A. Types of Products Covered, “Some industries, such as the video gaming and medical device industries, argue that they are unique and should be excluded from any action. … [M]edical device manufacturers argue that their products are ‘categorically different than consumer goods in that they are heavily regulated products which have direct impact on patient care and safety.’ … [T]here is no consensus about whether such exclusions are appropriate. For instance, Minnesota Senator Osmek has safety concerns about including medical equipment in his state’s right to repair legislation, although he also expressed an interest in discussing whether such an exclusion should be absolute. Vermont Senator Pearson, on the other hand, noted that he has not been persuaded by the arguments made by the medical device and video gaming industries that they should be excluded from right to repair efforts.”

TCO is Important

When it comes to imaging equipment, the ability to control the total cost of ownership (TCO) of a piece of equipment through choosing among independent service providers can affect the purchasing decisions of hospitals, facilities, and clinics. The issues raised in the report are complex and will take time and the combined efforts of the FTC and federal and state legislators to work through them for the consumer’s benefit.