Profile: Jeremy Gilley

The man marketing world peace

More education needed to ensure in-app purchases aren't child's play

News the Office of Fair Trading is launching an investigation into whether mobile games that charge for virtual goods are marketing too aggressively to children highlights the need for further education around in-app purchases.

Lara O'Reilly

You will have seen countless stories about a young Tarquin or Tarquina tapping away on their parents’ iPad, only for Daddy to discover their darling offspring had racked up a £1,000 bill just by buying a few couple of hundred virtual donuts.

Those stories don’t just leave a bitter aftertaste for the parents but also put app store companies in an increasingly compromised position. Indeed in February Apple settled a lawsuit brought in 2011 after parents sued the company after finding their children had landed them with hefty credit card bills. The company agreed to give them iTunes credits and cash refunds for claims over $30.

Although it may seem bizarre for people to purposely buy goods they will never actually feel or use beyond a game, in-app purchases are big business for developers and the likes of Google, Apple, Microsoft and RIM who take varying revenue cuts from any in-game transaction. The market is expected to generate $7bn by 2015, up from $2.4bn last year, according to stats from Juniper.

The majority of top-downloaded games in the Android market (around 80 per cent) are free to install but are monetised through advertising and charging for in-app content. Unfortunately for parents, the majority of those games - such as Candy Crush Saga, The Simpsons Tapped and DragonVale - use bright colours, cartoon characters, easy to learn game mechanics and have an unwavering appeal with children.

What parents need to realise is the mobile landscape is largely representative of the real world. If your sprog chucks a load of sweets and toys into the supermarket trolley when your back is turned and you don’t realise the cashier’s put it through the till: hard luck. Claim a refund.

Fortunately with mobile, there are also preventative measures to stop your children spending your entire bank balance via your phone.

Most new smartphones now come with pre-installed safety locks. The HTC One has “Kid Mode”, while Windows Phone 8 has “Kid’s Corner”. For those who don’t have the latest and greatest, there are plenty of free downloadable apps (and they won’t have any hidden nasties inside).

I’d wager the majority of parents wouldn’t let their child loose with their credit card and PIN, yet they’re doing exactly that every time they let them fiddle on their smartphones and tablets.

While it’s not their entire responsibility to hold the hands of absent-minded parents, the mobile manufacturers, operating system creators and app developers need to do more by way of marketing to help parents realise the two are analogous if they want to ward off a barrage in refund claims and dents to their user-friendly reputations. Regulator PhonePayPlus has already seen a 300 per cent increase in complaints about the bills generated by in-app add ons.

Pre-installing child lock features is one thing, but the mobile industry must do more to protect its users from losing money unawares. It will surely cost less to invest in marketing and show willingness than fork out on more reimbursements and legal costs.

In-app payments are not going away - the OFT has categorically said it does not want to ban them - so more must be done to ensure users understand exactly how they work and importantly how to avoid unintentionally making them.

Readers' comments (3)

  • Think you and the OFT have got this totally wrong, the problem lies in the way Apple and other shops work. There should be a specific need to enter credit card details each time - or the use of a password linked to the credit card rather than the password on the device.

    It surprises me that regulators are being so lax over this - or maybe I shouldn't considering regulators let the banking crisis happen!

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  • Agree with Brian. Our kids are two years old. Try educating them about in-game purchases. There should be some kind of captcha.

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  • I agree with the two comments above. Responsibility lies with the game developers. Parents may have the games on their devices but that doesn't mean that they engage with them in any way and the kids are often too young to be held responsible for anything. Comic book apps on Android require the user to enter their Google account password for each purchase, then the comic downloads instantly - so it is possible to have that extra level of control.

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