Apple and developers are being accused of unethical, expensive freemium extras in iPhone and iPad apps, and are being sued by angry parents who feel many apps exploit children with extortionate fees.

In the old days before tablets and smartphones kids could make their parents choke on their cornflakes while opening up their post by running up huge long-distance telephone call bills.

Today some parents are fainting at extraordinary iTunes statements via email, with apps enticing young children to download in-app purchase of up to £70/$110 a time.

Industry commentators are now suggesting that Apple in particular is partly to blame for allowing such high in-app prices within kids game apps – particularly those aimed at children too young to properly understand real money.

Games apps often disguise such purchases by naming their own in-game currency. For example Smurfs’ Village, once the highest-grossing app on iTunes despite being an initial free download, sells virtual “Smurfberries” for up to £69.99.

Virtual currency for kids in-app purchases

The problem is less with expensive iPhone and iPad apps as with supposedly free apps that include hooks to get users to buy add-ons to continue game play and bonus features.

These so-called Freemium apps are given away for free but quickly require users to buy extras to keep playing games or unlock new features. In the hands of a child such apps can cost parents a fortune.

While iTunes requires a password, the session can remain open for a period of time after a parent downloads a new app – allowing a child easy access to in-app purchases.

According to Apple's own Support Help pages on in-app purchaes: "Every time you make an In-App Purchase using iOS 4.3 or later, you will be asked to confirm your purchase by tapping Buy. If it has been less than 15 minutes since your last In-App purchase, you will not be required to type in your account password again".

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One parents' group, led by attorney Garen Meguerian, claims that it's too easy for children to spend money on in-app purchases without their parent’s knowledge.

Apple had called for this case to be dismissed, as there is an iOS "child friendly" option that enables parents to turn off in-app purchases. But US District Judge Edward Davila has given the hearing the go ahead. Apple is expected to submit a legal defence for the case May 24.

Apple argued that although the children purchased the extras, the relevant contract was the terms of service in place between the parents and Apple. The terms of service placed responsibility for unauthorized use of log-in credentials on the end user; therefore, Apple argued it was not responsible for the in-app purchases. The parents argued that each in-app purchase was a separate and voidable contract that may be disaffirmed by the parent or guardian. The Technology & Marketing Law Blog has a deeper discussion into the legal discussion on in-app purchases.

Macworld reports that Meguerian highlighted several examples of the ease at which children can download extra content in his court filing made in April 2011, demanding a jury trial. He claims that his 9-year-old daughter purchased roughly $200 (£125) worth of in-app purchases without his authorisation.

Many popular, free childrens’ apps include promos for similar paid-for games, so that kids can nag parents to download. In the main these promoted paid-for apps are parent friendly at 69p/99c or a little higher.

The problem of extortionate fees arises within games that require expensive in-app purchases to continue game play. Some apps for kids encourage them to click on links that can cost their parents up to £70 for extra content.

Parents are happy to pay a little to keep their young ones entertained but many are shocked at these ruinous in-app demands – especially as they are buried within cute kid-friendly games.

Take the seemingly unthreatening Fluff Friends Rescue, an “adorable” game by developer SGN. The app is free to download but almost immediately starts asking the players to buy game extras, costing as much as £69.99 – more than most console games.

Fluff Friends Rescue in-app purchases

Someway down the product description on Apple’s App Store is the note: “Fluff Friends Rescue is free to play, but charges real money for certain in-app content.”

It goes on to point out that “You may disable the ability to purchase in-app content by adjusting your device’s settings.”

The default setting, however, allows for immediate extra purchases. A less-than-eagle-eyed parent might easily miss this before the excited child starts playing, and potentially buying in-app features.

Expensive in-app purchases Fluff Friends Rescue

SGN has a portfolio of similar free apps aimed at very young children, including a series of Dress Up! apps for little girls.

The same is true of games such as Smurfs’ Village (by Capcom Entertainment), again quick to request extra £70 purchases to allow game play to continue. Kids have to buy “Smurfberries” to play significant parts of the game.

Smurfs Village in-app purchases

One wheelbarrow of Smurfberries costs a whopping £69.99/$110 (see above).

(Smurfs’ Village does include its in-app “note” close to the top of the game description, but with a similarly vague mention of a means to switch off the ability to purchase.)

This strategy isn’t limited to kids games. Mass Effect: Infiltrator from EA has some pricey in-game purchases – mostly for time-saving options. The CEO pack that unlocks 200,000 in-game credits to buy weapons and armour with costs a hefty £34.99/$49.99. But that sum is dwarfed by many kids games.

Confusing app dialogues

The above in-app request shows how wording can be confsuing even to an adult.

Parental anger at these ultra-expensive in-app purchases is growing. One parent recounted how his five-year-old son spent around US$260 while playing app Lil’ Pirates before he spotted the payments on his iTunes billing.

“I am not naïve. I understand that in-app purchases are here to stay, that they give software publishers and iTunes a valuable stream of revenue – I just think that they should raise the bar a little when it comes to ethical conduct.

“Why should there be an in-app item that is worth more than $80 in a game that seems designed to appeal to children? Shouldn’t there be some sort of authorization protocol built in to prevent unauthorized purchases or exploitation by unscrupulous publishers? Apple seems to have dropped the ball here.”

Another father writing “A Dad’s Plea To Developers Of iPad Apps For Children” writes “If you try to trick my kid into buying stuff, you’re dead to me.”

“A lot of apps do this, but Talking Tom Cat is the absolute worst. The screen is a landmine of carefully placed icons that lead to accidental purchases — not to mention the random animated banner ads that are designed to draw attention away from the app itself. If you try to use persuasive design on my young daughter, all bets are off. Your app will be deleted, and we’ll never do business again.”

Talking Tom in-app purchases

Talking Tom in-app purchases aren't all cheap 69p deals, see below.

Talking Tom in-app purchases 2

The problem is that many parents don’t discover these in-app purchases until too late.

A parent who felt ripped off by Smurfs’ Village was skeptical about Apple and its developers’ contention that  parents were covered by the ability to change a app’s settings to hide in-app purchases: “They make it a ridiculously difficult game to play, and you can skip all the difficult parts by spending money. I believe that they know exactly what's going on."

Attorney Meguerian claims that Apple’s new in-app purchasing restrictions still aren’t good enough, because children over the age of 13 are permitted to set up their own iTunes accounts, and the restrictions don’t prevent children who know their parents’ iTunes passwords from downloading content.

How to restrict in-app purchases in kids’ iPhone/iPad games

Device owners can turn off the in-app purchase option by going to the iPad or iPhone’s Settings app. To the left there are settings for Apple and third-party apps. Scroll down to the app inquestion, and there should be an option to the right “For paid users” that includes a “Child friendly mode”.

How to restrict in-app purchases in kids’ iPhone/iPad games

However, recently downloaded games do not immediately show up in the Settings panel. Anyone who has downloaded an app for a child knows that the kids want to start playing immediately.

In tests on several kids’ apps we found the apps didn’t show up in Settings for hours after download.

How to request refunds from Apple for expensive iTunes apps

Apple does take requests for refunds through the PC or Mac version of iTunes.

In the iTunes "Store" menu, chose "Account" at the right “Quick Links” panel, then click "Purchase History," and "Report a Problem."

Parental advice for kids' apps

The best advice we can give parents is to check every app they download for their children by watching their child play for a while or actually playing the games themselves, and then adjust settings to deny in-app purchases. To be safer still delete any apps that entice children to make further purchaes within an app.

Have your kids downloaded apps without your knowledge? Let us know in the Comment below.