ACCC investigating ‘Freemium’ apps on Mobiles

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The Australian Competition and Consumer Commission (ACCC) have today announced that they, and with 50 agencies globally, have started investigating free applications on mobile markets which offer in-app purchases. The joint effort has been undertaken to improve the education and protection of consumers when using ‘Freemium’ apps.

Currently, many app developers are making their apps free to download. However, the apps will have limited functionality without an in-app purchase to enable certain features. Additionally, many game developers are using in-app purchases to enable users to buy credits or coins, to allow the user to progress faster in the game. When parents are letting their children play games on a phone, the children often don’t know that they’re spending real money when making in-app purchases.

ACCC Deputy Chair Delia Rickard said:

Consumers need to be aware that ‘free’ may not mean free. Games and apps in the ‘free’ area of an online store may be free to download but attract costs for in-app purchases. Some of these apps are marketed for children, who do not connect the game they are playing with spending their parent’s money in the real world.

While many app stores require a password to purchase applications, in some stores, in-app purchases can be made without a password within 30 minutes of the original purchase. For Apple users, the ACCC recommends that you set a device restriction that requires the password to be entered for each purchase or to disable in-app purchasing all together. Android users can enable a restriction that requires a password for each purchase, however, this is subject to a 30 minute window.

The ACCC have published a checklist to ensure parents can avoid the issue. It includes:

  • Learn how to control a device, including setting restrictions for passwords.
  • Consider disabling in app purchases for devices used by children. Step-by-step instructions are available at http://www.accc.gov.au/in-app-purchases
  • Consider downloading apps for parental control of smart devices
  • Get to know the technology your kids are using and the games they are playing
  • Consider switching the internet off on your device when children are using it
  • Use gift cards instead of credits cards

Additionally, the ACCC have posted a checklist for those parents who have been affected by this:

  • Contact the app store as soon as possible to request a refund
  • Contact your bank to discuss any unauthorised charges appearing on your credit card
  • Visit the website of your local consumer protection agency or the ACCC for advice or contact them to make an inquiry or complaint
  • Some app related purchases can be billed to your mobile bill. If you have a dispute about charges on your mobile bill that you can’t resolve with your service provider, contact the Telecommunications Industry Ombudsman.

The best way to avoid the issue however is knowing what your child is doing on your mobile phone. The ACCC does want to hear from anyone that has been affected by this on their website.

Source: ACCC