Geek Lifestyle and Culture
10th February 2013 10:24:00
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Is it time to regulate in-App advertising and micropayments?

Monetising apps on mobile has long been a difficult task - with so many free applications already available, how does a developer achieve any kind of reasonable return on their investment? It's a conundrum faced by both large and small developers alike. At the current time developers have settled into three camps - a small payment up front, ad-support or microtransactions; the divide isn't as clear as that though as there are some titles that combine some or all of these models. The waters are becoming muddier with the advent of free-to-play games on computers and consoles that are supported by related payment models AND the fact that some full price games now take payment too!

Return on investment is important - if a company can't make the money back it spent developing software then they'll either abandon that specific app OR stop developing at all, but have we now reached a point where in-app advertising is an issue and what of in-app microtransactions?

There are a number of distinct problems with the idea of advertising and accepting payments for in-app products;

Advertising in games aimed at children


This is a serious issue - advertising at ANYTHING aimed at children is not only a technical and financial problem, but also a question of morality. This is bigger than TV advertising in that it's often highly targeted and designed to get children to push on the ads and banners. Added to the fact that we've seen many inappropriate adverts appear in children's games - gambling, dating and even scams. There has always been some level of questionable targeting in internet marketing but when these promotions are being delivered directly into the eyes of kids more has to be done to ensure suitability.

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In-app purchases in children's games


Again, this is a worrying trend - games being made available for free but severely limited to the point that children can do little more than view a fancy menu screen. When pressing on almost all buttons results in a visit to the app store with purchase options ranging from Pennies to Pounds there is clearly a motive here to make as much money as possible through less than altruistic means. Parents can be as selective as they like, but even the biggest children's franchises suffer from this in one way or another. All we can do is be happy that passwords are required to make purchases.

Advertising in paid-for games and apps


Thankfully, this is a rarity and usually limited to advertising the developers other software, but on occasion we have seen the odd banner ad appear in a game we've already paid for. This isn't new - advertising on paid services has always been there; look at Sky or Xbox Live - you can't avoid the advertising and therefore we can't really criticise app developers for doing the same thing now that it's socially acceptable on other platforms.

In-app purchases in full-price games


This one blows our mind - if you pay 40 for a Dead Space 3 you shouldn't then expect to have to then shell out even more money to make good progress in the single player campaign. The developers argue that you don't have to do this, and that it provides a fast-track way of gaining an advantage - but even then this ISN'T acceptable and introduces real questions over the concept of a 'cheat' in a game. Up until now there were communities of people trying to find hidden modes or workarounds that were very much a bit of fun; but now we've reached a point where it is being claimed that if a gamer manages to find a hidden way of increasing their inventory of items that could have been paid they're being warned that this could be classed as theft. Seriously, WTF? Theft? Have we really come to this?

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We don't deny that developers HAVE to find ways of supporting themselves - advertising and in-app purchases have a place, and in software aimed at adults we don't have any problem with this. We question the inclusion of such things in apps that have already been purchased up front, but if it is a necessity we can live with it. What we DON'T like is unacceptable advertising and microtransactions in children's games - a 'cupcake maker' shouldn't have a banner for 'Plenty of Fish' and it certainly shouldn't try and charge a child 1.49 for a few sprinkles to finish off their design. And we really object to major publishers charging a fortune for their games and then trying to bolster that further with the threat of criminal action taken against anyone who stumbles upon a glitch or bug left in by the developer and uses it to their advantage!

Who should be regulating this - should there be an independent body, should the app store curators have more responsibility and place restrictions on what an app aimed at children should contain? What do you think of in-app advertising and micropayments? Let us know below.
About Colin Polonowski
As the publisher and technical lead of The Digital Fix, I occasionally contribute to all areas, but in general leave the specific area management to the people who know what they're doing. I am the main contact point for anyone who wants to discuss advertising, licensing, syndication and anything else at a business-level.