Connecticut Watchdog: 6/24/2012

Most parents are thrilled to see their young children entering the digital world by becoming proficient with tablets, digital music players and smart phones.

But for many Connecticut residents the excitement has turned to anger after discovering that their children racked up hundreds, and in one case thousands, of dollars in credit card charges by using free game applications that then entice children to spend real money to purchase virtual items like cows, play money, unicorns, dragons and dogs.

Many of the virtual products cost $10 or more. For instance, Tiny Zoo encourages children to purchase Chickity Puff using 100,000 virtual coins for $99.99

C.W. of Simsbury said he was stunned in March when he discovered that his 8-year-old son ran up more than $7,600 in four days playing free games like Dragonvale and Tiny Tower - games that encourage children to use real money to purchase virtual objects to make the games more fun.

He wrote to me that he was embarrassed by what he allowed to happen and wanted to warn other parents about the dangers of these free games designed to suck children into making purchases. He let his son have access to his iTunes password when he purchased an iPod for him on his eighth birthday.

He was lucky. Capital One - his credit card company - deleted the charges and refused to make the payments to the app companies.

Most others were not lucky:

"Apple should not allow this in-app purchase option on games aimed at children," Dan wrote me in April. "My daughter thought she was using virtual money, not the real thing, and she is upset that she was taken for $189. She is 11 years old and she feels she was scammed … this is what Apple is doing by allowing this in-app purchase so deceivingly.

"This and all app games aimed at kids should come with in-app purchases disabled and any purchases should be clearly marked and warned. This is a scam app - keep your kids away."

Christalyn wrote me, "My 8-year-old played a free game and now we have over $134 in charges. Apple's customer service is awful and you have to wait for them to respond by e-mail. A service person offered to refund the charges if I made another purchase. This is such a scam and needs to be illegal,"

And it is a huge business.

The Wall Street Journal wrote this month, "These mobile games generated $2.7 billion in revenue last year, according to the game-research firm SuperData, opening a lucrative new chapter in the business of marketing to children. Apple Inc., Google Inc. and Amazon.com Inc., maker of the Kindle Fire tablet, operate app stores with growing catalogs that pay them 30 percent of each sale."

Last year, lawsuits seeking class-action status were filed against Apple, accusing it of duping children into purchasing these virtual toys.

At the time, iTunes was set up so that once an app was downloaded using the password, anyone using the iProduct could download apps and virtual objects for 15 minutes without having to again enter the password.

As the result of the suits, iTunes now requires the password to be entered every time anything is purchased.

The problem is that many parents give their children their passwords and let them download free game apps without realizing - until too late - that their kids can then buy the virtual objects by using their passwords. Here is a list of some of the items from the WSJ article and their costs:

• Lady Luck Fairy, $33.97

• Unicorn, $4.99

• Border Collie, $29.97

"You've now got the ability to invade the kids' space much more aggressively than ever before," Scot Osterweil, a designer of educational games and a research director of the comparative media-studies program at the Massachusetts Institute of Technology, told the WSJ.

You can reach The Watchdog at george@ctwatchdog.com. Check out www.ctwatchdog.com for consumer, health, finance, shopping, nutrition, Connecticut grown food, elderly issues, media, internet, computer, travel, auto, religion news and education tips.

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