The Competition & Markets Authority (CMA) in the UK is investigating how three major companies – Microsoft, Sony and Nintendo – are handling renewals for their online gaming services. The CMA will look at the T&Cs they offer users alongside how they process subscription cancellations and refunds.
At the heart of this is the issue of “roll-over contracts” (i.e. ones that automatically resubscribe a user and bill them when a contract period ends). The CMA has told the BBC that it is “concerned” about whether or not the companies named in the investigation, which is at an early stage, are behaving legally here.
“Roll-over contracts are becoming more and more commonplace and it’s essential that they work well for customers,” said Andrea Coscelli, the head of CMA, in a statement.
This is not the only dispute over online subscriptions, of course, as last month Spotify has filed a complaint at the European Commission against Apple over its in-app subscription policy on iOS and the cut Apple takes when processing subscriptions for third-party companies on its app platform. Spotify claims Apple is engaging in anti-competitive behaviour. Apple has responded by accusing Spotify of “misleading rhetoric” on the issue.
The two cases (Spotify vs Apple and CMA vs Microsoft, Sony and Nintendo) are specific to certain aspects of online subscriptions, yet how they play out will have huge implications for not just digital content services but also the customers they want to retain.