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BizReport : Mobile Marketing : July 21, 2014

European Commission forces Google, Apple to make users aware of 'true cost' of an app

Google has agreed that no app downloads that push in-app purchases will be labeled as 'free' in Europe as of the end of September this year, following criticisms by the European Commission.

by Helen Leggatt

The move by Google follows a spate of complaints from smartphone users about in-app purchases being pushed in so-called 'free' apps, particularly those apps that are targeted at younger users. Many popular apps are free to download, but they are designed in such a way as to tempt users to pay for in-game enhancements such as currency or faster progress through a game.

Just recently, in the UK, the Advertising Standards Authority upheld a complaint about the 'free' mobile game 'Dungeon Keeper'. While the classic game is, technically, free to play, the Advertising Standards Authority took issue with charges made for in-app purchases which significantly enhanced and impacted gameplay. This, says the regulator, made any claim that the game was free-to-play unreasonable.

Now, the European Commission is forcing Google and Apple to make users aware of the 'true cost' of an app.

"The Commission is very supportive of innovation in the app sector," said European Commission vice-president Neelie Kroes. "In-app purchases are a legitimate business model, but it's essential for app-makers to understand and respect EU law while they develop these new business models."

Google has decided on a number of changes including:-

- not using the word "free" at all when games contain in-app purchases;

- developing targeted guidelines for its app developers to prevent direct exhortation to children as defined under European Union law;

- time-framed measures to help monitor apparent breaches of European Union consumer laws;

- adapting default settings, so that payments are authorized prior to every in-app purchase, unless the consumer actively chooses to modify these settings.

"Although, regrettably, no concrete and immediate solutions have been made by Apple to date to address the concerns linked in particular to payment authorization, Apple has proposed to address those concerns," announced the European Commission in a press release.

"However, no firm commitment and no timing have been provided for the implementation of such possible future changes. CPC authorities will continue to engage with Apple to ensure that it provides specific details of changes required and put its practices into line with the common position."

Image via Shutterstock

Tags: app, freemium, in-app purchases, law and regulation, mobile

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