OFT publishes guidance on in-app purchases

The Office of Fair Trading (OFT) has published a set of principles relating to in-app purchases (commonly referred to as micro-transactions) in mobile and online games and has stated that developers who fail to comply risk enforcement action being taken against them. The principles have been drafted in response to behaviour by developers which the OFT deemed to be unfair, misleading and targeted in particular at children.

The guidance requires that in-app purchase should give the payment account holder (usually a parent in the case of young children) has expressly consented to the payment being made. The OFT believes that consent should not be assumed under any circumstances, such as by using opt-out provisions. The principles require that the total cost of purchasing and using an app or game should be set out, including initial costs and any unavoidable costs incurred as a result of playing the game. Optional costs should also be set out so informed consent can be given to such payments being made. The move is being seen as a way of stemming the manipulation of children and also introducing a degree of transparency in relation to the total cost of gaming.

Notwithstanding the OFT’s posturing, it surely follows that account holders are best able to safeguard against bills being racked up on in-app purchases by preventing payments being made without a password or passcode. The OFT accepts that parents have an important role to play and advises that device settings should be monitored and appropriate security measures should be put in place. Developers seeking to maximise their returns on mobile games will no doubt, for the large part, be up in arms about the move, with many believing in-app purchases provide a useful way in which to monetise their development costs and to stem the tide of piracy which is often cited as a key obstacle to profitability by developers.

Notwithstanding their concerns, this solicitor is firmly of the opinion that in-app purchases have ruined the mobile gaming landscape.

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