Parents whose children racked up hundreds of dollars in in-app purchases on Apple devices are getting their money back.
Apple has entered into a consent decree with the Federal Trade Commission, agreeing to refund the parents of children who racked up big charges in-app purchases without their explicit consent. The company is required to pay out a minimum of $32.5 million and notify affected consumers that refunds are available. Any funds Apple doesn’t dole out within 12 months must be remitted to the FTC.
If this all sounds a bit, well, repetitive, Apple agrees. Last year, the company settled a lawsuit over this very issue, offering iTunes credits and cash refunds to parents who sued over exorbitant in-app purchases, to be paid out this year. In a memo addressed to Apple employees and acquired by Re/Code, Apple CEO Tim Cook remarks that the FTC’s involvement “smacked of double jeopardy.” Apple chose to sign the consent decree and avoid a second protracted legal battle, as the FTC’s proposal “does not require [Apple] to do anything we weren’t already going to do.”
At issue is the ease with which children could dodge that parental consent requirement: After entering your password to make a purchase on an iOS device, there is a 15 minute window to make additional purchases without additional verification. Children were allegedly using this opportunity to rack up virtual goods in the games they were playing. The in-app charges on these apps range from as little as 99 cents to a hundred dollars — in one case, a parent reported that their child spent $2,600 on in-app purchases in a single game.
VentureBeat and marketing technology analyst David Raab are working on a new Marketing Automation usage and ROI study
. If you currently use a marketing automation system, help us out by answering the survey.
If you do, we'll share the resulting data with you.