Mobile Tech Today

CIO Today Network Sites:   Top Tech News  |   CIO Today   |   Mobile Tech Today   |   Data Storage Today
News & Product Reviews for Mobile Tech Users
Vblock™ Systems:
Advanced converged infrastructure
increases productivity & lowers costs.

www.vce.com
Friday, April 25th 
Real-time info services with Neustar
Trending Topics:   Security Heartbleed Big Data Cloud Computing Windows XP Data Centers OS X Mavericks
Home
Laptops & Tablets
Mobile Phones
Mobile Gadgets
Mobile Apps
BYOD & MDM
iPad
Mobile Industry News
Wireless Connectivity
Wireless Security
GPS & Maps
MTT Press Releases
 
Free Newsletters
Top CIO News
 
Mobile Tech Today
 

Apple/Mac

Apple Settles FTC Dispute for $32.5M

Apple Settles FTC Dispute for $32.5M
January 15, 2014 12:24PM

Bookmark and Share
Settling with the FTC over kids' App Store purchases is good PR for Apple and money well spent. Apple is a trusted brand. It wants people to think of the App Store as a place where every family member can go safely. Not settling with the FTC would make Apple look like a company that takes advantage of kids and foolish parents, said analyst Rob Enderle.

Your Next Generation Data Center Is Here! Vblock™ Systems: the world's most advanced converged infrastructure are built on the Cisco Unified Computing System with Intel® Xeon® processors. Vblock™ Systems deliver extraordinary time to market, ROI and TCO, and flexibility to meet your continually changing demands with 5X faster deployment, 96% less downtime, and 1/2 the cost. Click here to learn more.

Apple has agreed to refund at least $32.5 million to parents of children who made in-app purchases without the consent of mom and dad. The refund will settle a Federal Trade Commission (FTC) complaint about the practice.

Under the terms of the FTC settlement, Apple also will be required to change its billing practices to make sure it obtains express, informed consent from consumers before charging them for items sold in mobile apps.

“This settlement is a victory for consumers harmed by Apple’s unfair billing, and a signal to the business community: whether you’re doing business in the mobile arena or the mall down the street, fundamental consumer protections apply,” said FTC chairwoman Edith Ramirez. “You cannot charge consumers for purchases they did not authorize.”

Violating FTC Act

Here’s the backstory: The FTC’s complaint alleges that Apple violated Section 5 of the FTC Act by failing to tell parents that by entering passwords they were approving single in-app purchases as well as 15 minutes of additional unlimited purchases their children could make without further action by the parents.

Apple offers many kids’ apps in its App Store that allow users to incur charges within the apps. Many of these charges are for virtual items or currency used in playing a game. These fees generally range from 99 cents to $99.99 per in-app charge.

The complaint alleges that Apple does not inform account holders that entering their passwords will open a 15-minute window in which children can incur unlimited charges with no further action from the account holders. What’s more, the complaint alleges Apple has often presented a screen with a prompt for a parent to enter his or her password in a kids’ app without explaining to the account holder that password entry would finalize any purchase at all.

Running Up a Bill

We caught up with Rob Enderle, principal analyst at The Enderle Group, for his take on the settlement. He told us, ultimately, settling is good PR for Apple and money well spent.

“Apple is a trusted brand. They want people to think of the App Store as a place where every member of the family can go safely. Getting the image of a company that takes advantage of kids and foolish parents would not be good for their brand,” Enderle said. “You can run up significant bills on free games real quick. Kids don’t have any sense of cash. I imagine some of those kids ran up bills of hundreds if not thousands of dollars.”

Enderle is right. In its complaint, the FTC noted that Apple received at least tens of thousands of complaints about unauthorized in-app purchases by children. One consumer reported that her daughter had spent $2,600 in the app “Tap Pet Hotel,” and other consumers reported unauthorized purchases by children totaling more than $500 in the apps “Dragon Story” and “Tiny Zoo Friends.” According to the complaint, consumers have reported millions of dollars in unauthorized charges to Apple.

Tell Us What You Think
Comment:

Name:



 Apple/Mac
1. Samsung: $2.2B Too Much for Apple
2. Google, Rockstar Suit Stays in Calif.
3. Samsung Tech Experts Talk Patents
4. Phones Annoy Patent Trial Judge
5. Apple vs. Samsung: Latest News




 Most Popular Articles
1. Google Glass Finds a Home in Medical Education, Practice
2. HP Rolls Out New Software-Defined Network Products
3. Smartphone Kill Switch Could Save Users $2.6B a Year
4. Avaya Aims To End Network Waiting Game
5. Google Video Shows Off Modular Project Ara Phone

Have an informed opinion on this story?
Send a Letter to the Editor.
We want to know what you think.
Send us your Feedback.

 Related Topics  Latest News & Special Reports

  Opera Coast Offers Safari Alternative
  Salesforce Developing App SOS Button
  What Might an Amazon Phone Offer?
  OnePlus One Boasts Android Weapon
  Samsung Gear Fit Geared for Exercise

 Technology Marketplace
Business Intelligence
Get real-time, cloud-based information services with Neustar.
 
Cloud Computing
Next Generation Data Center Is Here! Vblock™ Systems from VCE
 
Contact Centers
HP delivers the future of the contact center with HP Qfiniti 10.
 
Data Storage
Next Generation Data Center Is Here! Vblock™ Systems from VCE
Barium Ferrite (BaFe) is the future of tape.
2.5" Enterprise-class SATA & SAS SSDs for server & storage applications
 
Enterprise Hardware
Barium Ferrite (BaFe) is the future of tape.
2.5" Enterprise-class SATA & SAS SSDs for server & storage applications
 
Hardware
Protect your network with APC Smart-UPS battery backup
 
Network Security
Protect your network with APC Smart-UPS battery backup
 

Network Security Spotlight
Tech Giants Fund Initiative To Prevent Future Heartbleeds
Can more funding prevent Heartbleed vulnerabilities in future open-source software? A new Core Infrastructure Initiative at the Linux Foundation is attempting to find out.
 
What Verizon's Data Breach Report Can Teach Enterprises
It’s probably not a jaw-dropper, but cyberespionage is officially on the rise. And the use of stolen or misused credentials is still the leading way the bad guys gain access to corporate information.
 
Top Cyberthreats Exposed by Verizon Report
Beyond Heartbleed, there are cyberthreats vying to take down enterprise networks, corrupt smartphones, and wreak havoc on businesses. Verizon is exposing these threats in a new report.
 
Navigation
Mobile Tech Today
Home/Top News | Laptops & Tablets | Mobile Phones | Mobile Gadgets | Mobile Apps | BYOD & MDM | iPad
Mobile Industry News | Wireless Connectivity | Wireless Security | GPS & Maps | MTT Press Releases
Also visit these Enterprise Technology Sites
Top Tech News | CIO Today | Mobile Tech Today | Data Storage Today

Services:
FreeNewsFeed | Free Newsletters | XML/RSS Feed

About CIO Today Network | How To Contact Us | Article Reprints | Services for PR Pros (In partnership with NewsFactor) | Top Tech Wire | How To Advertise

Privacy Policy | Terms of Service
© Copyright 2000-2014 Mobile Tech Today. All rights reserved. Article rating technology by Blogowogo. Member of Accuserve Ad Network.