ACCC urges app industry to adopt new principles following ‘sweep’ of children’s game apps

9 December 2013

The Australian Competition and Consumer Commission’s recent sweep of over 340 ‘app’ games in the Google Play and Apple App Stores highlights a need for guidance to the app industry to protect consumers.

In its sweep, the ACCC discovered that many ‘free’ games that appeal to children do not come with adequate disclosures about costs associated with app-based games. Fewer than 25 per cent of children’s ‘free’ game apps swept on one platform disclosed that in-app purchases could be made.

“Once you’re playing, many games make it clear that you can get ahead or avoid getting bogged down if you shell out for in-app purchases. Children exposed to this won’t always connect a tap on the screen in the heat of the action with spending their parents’ money in the real world,” ACCC Deputy Chair Delia Rickard said.

The ACCC also found that less than 20 per cent of children’s ‘free’ game apps across both platforms included information about how to restrict devices to prevent inadvertent in-app purchases.

“While there are some optional tools available to parents to restrict purchases, the ACCC and consumer regulators across the globe are looking together at whether people really know what to expect before the game is downloaded,” Ms Rickard said.

The sweep highlighted the potential for misleading and deceptive conduct in the promotion of apps as well as inadequate disclosure of key terms and conditions associated with using the apps.

Many of the games reviewed by the ACCC did not provide access to the terms and conditions prior to downloading and playing the game. Parents or children purchasing and using these games may not be aware of important information about games including the suitability of content; third party collection of personal information; and social sharing through app games.

The ACCC supports the objectives of proposed principles for the online and app-based game industry. The draft principles, released by the United Kingdom Office of Fair Trading (UK OFT) on 26 September 2013, are designed to protect children playing app-based games on smartphones and tablets.

The principles include that:

  • Consumers should be told upfront about any possible in-game costs or advertising
  • Important terms should be prominently disclosed prior to download
  • An account holder, such as a parent, needs to have given informed consent to payments – otherwise they are not authorised 

The ACCC is continuing to investigate concerns about misleading conduct in relation to a number of apps. While the ACCC may take enforcement action where contraventions of the Australian Consumer Law are identified, it is urging app developers and platform operators to take steps to address concerns held both in Australia and overseas about app based games.  There is a need for guidance to help businesses avoid possible contraventions of the Australian Consumer Law.

To help consumers, the ACCC website offers tips for parents on how to avoid ‘bill shock’ when playing app-based games, including screen-by screen instructions on how to restrict purchases. Apple users can change their default settings to require a password for every purchase, instead of once every 15 minutes, or disable in-app purchases. Google-Android users can change their settings to ask for a password before a purchase but there will still be a 30-minute window where users can make further purchases without needing to enter a password. Software updates may result in changes to device settings, so always check with your device manufacturer or platform operator about where to find and change these settings. 

Consumers who have problems with in-app purchases, or identify unauthorised charges, should contact the platform operator to discuss their concerns

Release number: 
283/13
Media enquiries: 
Media team - 1300 138 917

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