Consumer Affairs inquiry: name and shame dodgy apps

The Commonwealth Consumer Affairs Advisory Council (CCAAC) has opened an inquiry into mobile apps and commerce.

In February last year, Smurfs' Village got in hot water over its in-app purchases (IAP). The free-to-play game's IAP system made it all too easy for kids to buy in-game currency and items, and parents were mad. In fact, that sort of payment security can be a bit of a problem with app purchases, and even though Apple has introduced security measures — such as a shorter length of time for which the App Store keeps you logged in — it still happens. And with Android, you can elect never to be logged out of Google Play.

A new inquiry aimed at uncovering holes in the way mobile commerce works asks consumers to name and shame apps with which they have had a dodgy purchase experience, with a focus on the way IAP and subscriptions are communicated to the consumer.

Assistant Treasurer David Bradbury said, "In a very short period of time, new mobile devices like smartphones and tablets have changed the way consumers engage in commerce. The pace of this technological innovation is driving entrepreneurs to use these new devices to come up with more and better ways to sell their wares to consumers. At the same time, though, some consumers have raised concerns about aspects of mobile commerce, particularly where purchases can be made without much difficulty using stored credit card data."

He added, "More and more people are downloading digital content like books, music, magazines and movies directly to their devices, while apps are being used as virtual shopfronts to acquire goods and services. Apps are also increasingly relying on in-app purchases and subscriptions, particularly common in games that may be played by children."

The inquiry will look at how many people are feeling duped by in-app purchases, as well as the current consumer protections and whether they are adequate when it comes to IAP.

The CCAAC will examine:

• The characteristics, features and trends of app markets in Australia

• Consumer experiences when downloading and using such content, including when used by children

• The adequacy of the information being disclosed to consumers about the costs associated when downloading and using this content before and after it is downloaded

• The adequacy of existing measures to address any consumer concern, including the legal protections available to consumers, the adequacy of default settings to ensure consumers are making an active decision before incurring additional charges, the availability and ease of use of opt-out features, the adequacy of existing parental controls for app stores and how these controls are promoted to consumers, and any other industry initiatives

• Actions that can be taken by consumers, industry and governments to help improve consumer experiences when making in-app purchases, including international approaches.

Public submissions have not yet been opened, but will soon. You will be able to make submissions via the CCAAC website.