California's New Law Forces Digital Storefront To Admit You're Just Licensing Content Not Buying It.

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California's Assembly Bill 2426, signed into law in September 2024, mandates that digital goods retailers must clarify to consumers whether their purchase grants ownership of the product or simply a limited, revocable license. This law targets the growing market of digital media like video games, movies, and music, which have often been marketed as "purchases" but sometimes come with restrictions or can be removed without a refund.

The law requires sellers to explicitly state when a transaction involves purchasing a license rather than transferring ownership. This must be clearly communicated using terms like “license” or similar, alongside a link or QR code to more detailed terms. If sellers fail to do so, they risk being penalized for false advertising. The intent is to prevent misleading terms that imply ownership when, in fact, consumers may only have access to content on temporary or revocable terms.

However, the law does not address subscription services, nor does it require changes for cases where access cannot be revoked, such as with certain digital goods. Critics argue that while the law helps clarify these transactions, it doesn’t fully resolve issues like the loss of access to digital purchases due to licensing problems or service shutdowns. So in essence, you're just licensing content from Steam and others.

You can learn more about it right here.