Office of Fair Trading investigation into costly ‘in app add ons’
Written by Samuel Martin on 12 April 2013« Return to Reading Room
It is now believed that more than a quarter of children aged between 5 and 15 own a Smartphone, with a considerably higher amount having access to them. This fact coupled with pressure from the website ‘Mumsnet’ has led to the announcement that the Office of Fair Trading will begin an investigation into how ‘in app add ons’ are marketed to children.
Many of these ‘in app add ons’ are made available to the user after they have downloaded a free App. Thousands of complaints have been made and in one case a child ran up a bill of £3,000 by purchasing ‘in app add ons’.
The seriousness of this has been brought to the attention of the OFT after Apple recently agreed to pay $100m to parents in compensation for children purchasing these ‘in app add ons’.
As well as OFT looking into whether the price of the additional content is sufficiently made clear to the user before purchase. An investigation will take place to determine whether this content falls into section 28 of OFT's ‘Banned Practices (Schedule 1) Guidance’ which will be deemed a breach if they are a:
“direct exhortations to children’ – a strong encouragement to make a purchase, or to do something that will necessitate making a purchase, or to persuade their parents or other adults to make a purchase for them".
OFT has made it clear that they do not wish to place a ban on the sale of these additional ‘in app’ services, however they wish to ensure they are complying with the relevant regulations.
Due to the size and profitability of this market, businesses who operate in this sector are sure to want to comply with OFT’s practices. The OFT are set to make a further announcement on this matter in October 2013.
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