Comment submitted by Christopher Soghoian

NORTHWESTERN JOURNAL OF TECHNOLOGY AND INTELLECTUAL PROPERTY Caveat Venditor: Technologically Protected Subsidized Goods and the Customers Who Hack Them Christopher Soghoian Fall 2007 VOL. 6, NO. 1 © 2007 by Northwestern University School of Law Northwestern Journal of Technology and Intellectual Property Electronic copy available at: http://ssrn.com/abstract=1032225Copyright 2007 by Northwestern University School of Law Volume 6, Number 1 (Fall 2007) Northwestern Journal of Technology and Intellectual Property Caveat Venditor: Technologically Protected Subsidized Goods and the Customers Who Hack Them *By Christopher SoghoianI. INTRODUCTION 1¶1 This paper focuses on the subsidization of a technology-based durable good. It goes on to discuss the delicate dance between the producer trying to protect its profit, 2competitors trying to create and sell aftermarket goods, and those innovative customers who use the items in completely unplanned and unprofitable ways. ¶2 An age old, but increasingly popular business model involves the subsidization of a 3proprietary durable good by a manufacturer, such that the good is sold below cost. Due to careful design, technological, and legal restrictions, the producer creates a primary product that is only compatible with its own aftermarket goods. It is through the sale of these proprietary aftermarket products that the producer is able to recoup its initial investment. An example of ...