Google Must Pay $19m Over Unfair Microtransactions

The Federal Trade Commission has ordered Google to pay $19 million to some of its smartphone customers due to the way it has sold in-game microtransactions.

Along with paying the huge fine, Google has agreed that Android apps cannot charge customers without "express, informed consent".

The complaint covers in-app purchases dating as far back as 2011, with numerous customers complaining they had been lumped with surprise bills due to their children purchasing virtual goods without their consent.

Key to this complaint was the ease in which children could buy virtual items on their parents' smartphones and tablets, and how these apps and games pushed purchase decisions on the player.

Google's settlement comes months after Apple was ordered by the FTC to pay $32.5 million for similar microtransaction policies. A complaint has also been filed against Amazon, although the retailer has so far challenged the accusations.

The FTC claimed that, in the US since 2011, some customers' children have made unauthorized purchases as high as $200.

The complaint centres around Google's introduction of in-app charges on Android devices, and how a password was not required to make a purchase. By 2012, Google had inserted password verification, but in-game purchases for thirty minutes thereafter would not require password verification.

This led to the familiar complaint of parents allowing their children to buy one item by entering their password, which gave them free reign to buy anything they wished for the next half hour.

"For millions of American families, smartphones and tablets have become a part of their daily lives," said FTC chairwoman Edith Ramirez.

"As more Americans embrace mobile technology, it's vital to remind companies that time-tested consumer protections still apply, including that consumers should not be charged for purchases they did not authorize."

In a statement, Google said it was "glad to put this matter behind us".

Smartphone games have transformed the games industry, generating tens of billions for games companies. In 2013 alone, Apple said more than $10 billion was spent on apps worldwide.

But in-app purchases and microtransactions have proven to be a source of controversy within the video games community. Electronic Arts was widely criticised for making microtransactions a key part of its Dungeon Keeper reboot.

In that game, the insistence on buying virtual currency was so strong that the UK's advertising authority forced EA to cease branding the game as "free".