Critics To FTC: Why Do You Hate In-App Purchasing Freedom?

jfruh writes The FTC has moved aggressively recently against companies that make it too easy for people — especially kids — to rack up huge charges on purchases within apps. But at a dicussion panel sponsored by free-market think tank TechFreedom, critics pushed back. Joshua Wright, an FTC commissioner who dissented in a recent settlement with Apple, says a 15-minute open purchase window produced "obvious and intuitive consumer benefits" and that the FTC "simply substituted its own judgment for a private firm's decision as to how to design a product to satisfy as many users as possible."

Comments

Their Job

[BitZtream]

Because its their job to hate people who take advantage of others in matters of trade?

Re:Their Job

[jd]

Very true. A wholly free market is actually quite toxic, as a certain Adam Smith noted. Especially when it's dishonest.

In-app purchases are the return of micropayments, but for virtual goods less valuable than Second Life real estate. It is, of course, entirely fair for companies to sell such products and for customers to buy them, but the control system is poor, virtual goods have an amazingly high failure rate for delivery, and prices are often in the small print.

Re:Their Job

[Bob9113]

>> Because its their job to hate people who take advantage of others in matters of trade?

> Very true. A wholly free market is actually quite toxic, as a certain Adam Smith noted. Especially when it's dishonest.

Yes. Yes, yes, yes! Exactly this.

the FTC "simply substituted its own judgment for a private firm's decision as to how to design a product to satisfy as many users as possible."

Because that is what we pay them to do. And there is a very good reason; because private firms measure customer satisfaction through the lens of maximization of profit (fairly short run profit in the case of apps), and the FTC measures it through imperfect objective analysis of the rational self-interest and informedness of the transaction participants. Gee, here's a surprise: Those two measures don't always agree, and sometimes, when they are far enough out of whack, it actually increases GDP in the long run if you limit the freedom of people to engage in inefficienty transactions.

A really good example of such potentially inefficient transactions is children, who do not understand how much time and effort it costs to acquire money, are in the throes of video game passion and a screen pops up saying, "Win More, Only $3.99! Buy Now!"

Joshua Wright, an FTC commissioner who dissented...

A market filled with efficient transactions increases GDP in the long run relative to a market with less efficient transactions. So, tell me, Joshua Wright; do you hate the economy? Do you want a lower GDP? Do you want our corporations to lose money? Do want our wealthiest stockholders to have to buy slightly smaller Gulfstreams? Answer me, Mr. Wright: Do you hate America?

Real world equivalent

[StripedCow]

You go to a theme-park with your children.
If the kids want to have an ice-cream, they just go to the ice-cream stand, order and say the name of their parents (you), so they get the bill when you leave.

Who thinks this is not a brilliant idea?

(Sorry for not posting a car-analogy)

Untrue statements

[Anonymous Coward]

When companies take advantage of customer addiction tendencies, it's predatory, and causes long-term suffering, for short-term satisfaction.
Since the companies can't regulate themselves, the government must do it for them.

Coke is without coke these days as well, and that is a good thing (coke causes the brain to become psychopathic over time).

Because The Children

[Anonymous Coward]

Socialism is democratic worker control of the means of production, you troglodyte. That's all it is. There is less security under socialism than capitalism, because nobody is allowed to rely on invested capital. This minor controversy has absolutely nothing to do with socialism.

All that's going on here is a few rich guys whining that they want ways of taking money from people using a technological loophole - the ease with which a child can use mom's credit card - rather than directly as a result of a contract formed between two adults providing informed consent. If anything, the capitalist position would run contrary to TechFreedom's argument because capitalism strives for informed, rational agents, necessarily treating children as a special case. To be clear, children usually cannot form contracts, but nobody owns children, therefore they cannot be entirely responsible for their actions.This reflects their status as developing humans.

So get off your high horse and stop worrying that the sky is falling. Every dull member of every new generation speaks like the "golden days" have come to an end because xyz minor thing that they don't really understand means the end of the world.

Re:There is a simple solution

[Mr. Slippery]

Is this where we set the bar of government interference in our private lives?

Commerce is not your "private life". It is the transfer of "property", something created by government fiat and enforced by government guns. And it in most cases is it the transfer of "property" to or from a corporation, an entity created by government fiat.

If it doesn't directly involve government issued land and resource deeds (the root of all physical property), copyright and patents and trademarks (the root of all so-called "intellectual property"), or corporate charters, and doesn't involve government-enforced contracts, then you can maybe complain about government interference in your "private life".

Re:Because The Children

[HiThere]

You clearly don't understand the meaning of EITHER socialism or communism. Communism predates Karl Marx. And Stalinism isn't even Marx-Lenninism. (Note the hyphenated designation, as that which Lenin preached and practiced wasn't what Marx preached.) Also neither is Maoism, which also is only one variety of communism. (Stalinism isn't ANY kind of communism. It's just standard totalitarian dictatorship with an unusually brutal and despotic dictator. Only Idi Amin could claim to practice the same kind of government, though Pot Pol had certain similarities.)

Calling yourself something doesn't mean that the label rightfully applies to you. The North Korean government calls itself a "People's Republic", but it doesn't match the conventional meaning of Republic. (Do note, however, that Republics are normally controlled by an Oligarchy of some sort. It's not the "feel good" term that USians are generally taught it is. Not if you really understand what it means and how it operates. And the constitution guarantees that the states will have a Republican [Things of the Public] form of government, not a Demmocratic [i.e., power derives from the people] kind of government. And in both these cases I grossly simplified the meanings of the terms. In fact I'd need to research a bit to determine precisely what each meant, though basically in a Republic power derives from ownership of things, and in a Democracy power derives from being a "person", for some meaning of person. [E.g., slaves were originally considered to be only 2/3 of a person in the US.] Please note that this doesn't mean that the power belongs to the people, but rather that the government allocates power on the basis of people.)