Federal Trade Commission Investigation of Apple

The Federal Trade Commission completed an investigation of Apple after receiving many complaints from the general public who have Apple products and stated that their applications lacked privacy disclosures. The Federal Trade Commission issues an administrative complaint when they have reason to believe that a company is violating a law, and it appears to the commission furthering their investigation is what is best for the public interest.[1] This issue was brought to the Federal Trade Commission because people felt they were in violation of the Federal Trade Commission Act and the Children’s Online Privacy Protection Act (COPPA).[2] The Children’s Online Privacy Protection Act states that parents should have control over what information websites are able to collect from their children, specifically under thirteen years of age.[3]
Apple has many third party applications available on their phones such as games and books. Eight thousands of these applications were found to contain the word “kid” according to the Federal Trade Commission[4]. Applications having this word in them are targeted towards children who legally shouldn’t be able to purchase them. Without having parental consent for purchasing these applications it has led to children racking up their parents phone bills and making unauthorized purchases. The fact that it is so easy to purchase these applications has led to some people having charges on their phone bills ranging from $.99 to $99.99 per application.[5] One consumer in particular had her daughter charge $2,600 in one application, “Tap Pet Hotel”, and was not refunded for the charge.[6] When purchasing these applications you need to go into a sign in process to access your account saying you will pay for these applications. The problem people were having with this process was that there was a fifteen minute window where once you purchased an application others could also be purchased without having to sign in again for each one and many people didn’t know about this window. This led to more applications being purchased, and children adding tokens to different games that cost money as well after their parents had purchased a game for them.
When the investigation was conducted by the Federal Trade Commission out of all the applications targeting children, only 76% of the applications were requiring at least one permission to run and required the parents to trust its application screening process.[7] Even though this is a good percentage of the applications, it should be all of them because of the Children’s Online Privacy Protection Act, and many only require a one-time permission so children could still purchase things like the tokens. The Association of Competitive Technology agreed with the investigation of the Federal Trade Commission and they as well had the same concerns with the mobile applications.[8] The investigation found that the customers of Apple had been filing complaints with the company since March 2011.[9]
There are two arguments regarding these issues with the Apple store applications, and depending on the side the issues vary widely. Apples didn’t really have much of an argument against the investigation of the company, but it continued to stand by the fact that the company was working on correcting the privacy issues and it wasn’t refunding the parents for the charges that their children had made.[10] The complaints made to the Federal Trade Commission were first heard by Apple from many customers, with no resolve. The Federal Trade Commission was stating they were in violation of the Federal Trade Commission Act and the Children’s Online Privacy Protection Act and owed the people a refund of their unauthorized purchases, because of their lack of knowledge.[11] This side of argument was both the Federal Trade Commission’s standing and the consumers.
Although these were the two sides of the argument there were many