Apple has to pay up for kiddie 'bait' apps

It has agreed to make refunds to some parents whose kids racked up big bills on supposedly 'free' games. The catch? Most can expect just $5.

By Aimee Picchi Feb 26, 2013 2:09PM
Apple iPhone 5 home screen with multiple apps.

"Bait" apps for mobile devices have become the bane of many parents' lives, with kids inadvertently racking up bills -- sometimes as high as thousands of dollars -- by playing supposedly "free" games such as TapFish and Smurfs' Village. 


But now, parents will get some relief, with news that Apple (AAPL) is settling a lawsuit over the games, which are downloaded for free but charge real money for buying in-game currency or virtual goods. 


The catch? Apple will offer a relatively paltry sum: a $5 iTunes credit to parents who claim a child purchased in-game items without their knowledge or permission, reports GigaOm. The settlement states that the "significant majority" of purchases were for less than $5.


The agreement, which still requires preliminary approval from a federal judge, doesn't state how much Apple will pay up. But it could lead to major costs for Apple, which says it will alert about 23 million iTunes account holders who bought in-game currency. If each of those consumers requests a $5 refund, Apple could be looking at a $115 million bite taken out of its coffers.


If your child spent more than $5 on buying Smurfberries, don't fret. Apple is allowing some bigger refunds: either an iTunes credit up to $30, or cash in cases where children spent more than that. Cash refunds are available only for parents who haven't previously received a reimbursement. 


Parents will be able to file for a refund after the settlement is approved and Apple starts notifying customers. Payments might not get doled out until early 2014, according to GigaOm. 


But better news for parents might be Apple's other piece of the settlement: It will provide instructions on how to disable in-app purchases. No more Smurfberries, honey. 


More on moneyNOW


13Comments
Feb 26, 2013 6:32PM
avatar
Apple is overrated!! I hope the company continues to suffer!!
Feb 26, 2013 8:52PM
avatar

EXCUSE ME...''SOMEONE''

Just what the heck do mean whining ''where are the parents ?''

--- this is why it's Apple's fault !--------

The kid comes to mom and asks ''can I play this ?..it's free.''

and off they go merrily playing away....until......TOMORROW I'M BILLED IN MY E-MAIL !!!!

--------NEVER ONCE IN ALL HIS PLAYING DID IT SAY HE WAS SPENDING MY REAL MONEY !!! -----

A COMPLETE SHAM !

Feb 27, 2013 5:17PM
avatar
The attorneys only get $1,300,000!  Guess it's not too much work to squeeze a $5 itunes credit from apple.  The apps were "largely available for free and rated as containing content suitable for children" so enough blaming the parents.
Feb 28, 2013 8:08PM
avatar
I dumped my iPhone for an Android last month, 1st smart move of 2013. The first dumb move of 2012 was buying it.
Feb 27, 2013 7:58AM
avatar
It's not that big of a hit for Apple. First, they make plenty anyway, but the pay out goes back into their pockets (as credits to the Apple store). How bad is that? I'm a car dealership and I sell you a bad car. You have to pay me to repair it, and in a lawsuit, I agree to give you credit for more work? It's something, but it's not that significant.
Feb 26, 2013 8:56PM
avatar
Giving out cash and giving out credit are two different things... Apple will not suffer any immediate loss, and not even on projected income... this is probably going to be written off at the end of the year and only SAVE them money.
Feb 26, 2013 8:17PM
avatar
Excuse me...  How is any of this Apple's fault?  Where are the parents when kids play these apps?  Put the blame where it belongs--on PARENTS!
Feb 28, 2013 4:15PM
avatar

I'm not a fan of Apple at all, especially after working for them, but this is not their fault at all.

Why can it not be the parents faults for linking their info and allowing their children to use these apps, or any app at all, without supervision?

This responsibility should be solely on that of a parent, not on a company providing a service which is being taken advantage of by others.

Learn to take responsibility, it seems all we do is live in a time where all you do is shift responsibility because you're too lazy to deal with it.

 

SMH.

Feb 27, 2013 8:41AM
avatar
iPads and iPhones are not toys. Apple should not have to pay because parents are irresponsible and are using computers as babysitters.
Feb 26, 2013 6:04PM
avatar
I have not used my credit rating for years and care less what it is. The guy who invented it said it was bogus and was to let as many eople as possible in to a credit line so they could expand their business. the 30% they were chrging made up for their mistakes and ruined a lot of people credit rating. I found out I did better paying cash all the way up to a car and a boat! I own my own home so thats not a problem.
Feb 27, 2013 2:09PM
avatar
This is the most biased coverage of this story I've seen. Nowhere does it mention that Apple took steps to prevent this as far back as iOS 4.3. This is partly Apple's fault, but at the same time the parents and the app developers are just as easily to blame.

Just bear in mind that the M in MSN stands for Microsoft...

Feb 26, 2013 6:04PM
avatar
Whats wrong with this thing again?
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

RECENT QUOTES

WATCHLIST

Symbol
Last
Change
Shares
Quotes delayed at least 15 min
Sponsored by:

MARKET UPDATE

NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
Market index data delayed by 15 minutes

[BRIEFING.COM] The stock market ended the Wednesday session on a mixed note with small caps displaying relative strength. The Nasdaq Composite (+0.5%) and Russell 2000 (+0.4%) registered modest gains, while the Dow Jones Industrial Average (-0.2%) and S&P 500 (+0.01%) underperformed.

Despite the mixed finish, the key indices traded higher across the board at the start of the session after the advance reading of second quarter GDP surpassed estimates (4.0% versus Briefing.com ... More


Currencies

NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.