Giant online retailer,
) said that it is prepared to go to court against the Federal Trade
Commission's ("FTC") charges, as it believes that it has already
done plenty to prevent kids from making unauthorized in-app
purchases from its devices.
Amazon wrote to the FTC stating that it would not comply with the
regulatory agency's demands to exercise more stringent policies
that would prevent children from making in-app purchases.
Instead, it is ready to defend itself in court.
The FTC claims that it has received an overwhelming number of
complaints regarding unauthorized in-app purchases by children on
Amazon devices, which have added up to millions of dollars. It
requires Amazon to update some of its policies by making in-app
purchases safe with passwords for every purchase, clearer
notification of additional charges and easier refund policies.
Purchases of digital goods are the reason behind the success of app
stores of Amazon, Apple and
). These app stores boost usage and sales of smart devices. Since
they also have credit card and other user records, there is the
need for stringent policies that could protect customers from
paying for unauthorized uses, especially by kids.
Amazon faces a potential litigation charge from U.S. regulators, if
it refuses to accept the FTC's demand. The FTC can sue Amazon to
impose policies, seeking similar settlement terms as it did in case
) earlier this year.
Apple settled with the FTC by agreeing to repay at least $32.5
million that were to be distributed to customers, whose children
made in-app buys without their parents' permission. It also used
new App Store safeguards to ensure parental consent while making
However, unlike Apple, Amazon refuses to bend and said that it
already offers intimation of any in-app purchases to customers and
immediate notifications to cardholders. It has always reimbursed
the money to affected customers. It also asserted that its
practices reflected the standards set by the FTC in the Apple
Amazon shares currently carry a Zacks Rank #4 (Sell).
Akamai Technologies, Inc.
), is a better-ranked stock carrying a Zacks Rank #2 (Buy).
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