Epic to Pay $520 Million to Settle US FTC Charges on Fortnite - News
by William D'Angelo , posted on 19 December 2022 / 3,242 Views
The US Federal Trade Commission (FTC) announced Epic Games will have to pay $520 million to settle charges on Fortnite over luring kids to have huge bills.
The FTC says Epic violated the Children's Online Privacy Protection Act (COPPA) and it "deployed design tricks, known as dark patterns, to dupe millions of players into making unintentional purchases."
Epic also collected personal information on Fortnite players under the age of 13 without notifying their parents or getting consent from a guardian.
The FTC stated Epic had enabled real-time voice and text communications for children and teens by default, which resulted in bullying, harassment and sexual harassment. When Epic added a button to turn off voice chat, the FTC said it was hard for users to find.
Epic will no longer be able to enable voice and text communications for children and teens unless consent is provided through a privacy setting.
The FTC in another complaint said Epic used a way to trick players of all ages into making unwanted purchases, which led children to amass unauthorized charges without parental involvement.
"Fortnite's counterintuitive, inconsistent, and confusing button configuration led players to incur unwanted charges based on the press of a single button," the FTC said.
"For example, players could be charged while attempting to wake the game from sleep mode, while the game was in a loading screen, or by pressing an adjacent button while attempting simply to preview an item."
The FTC also claims Epic ignored over one million user complaints over being wrongfully charged. Epic also allegedly locked accounts of players who disputed unauthorized charges with their credit card companies. This means they were blocked from using any content they had purchased. This will no longer be allowed.
Epic in its own response to the settlement stated, "No developer creates a game with the intention of ending up here. The video game industry is a place of fast-moving innovation, where player expectations are high and new ideas are paramount. Statutes written decades ago don’t specify how gaming ecosystems should operate. The laws have not changed, but their application has evolved and long-standing industry practices are no longer enough. We accepted this agreement because we want Epic to be at the forefront of consumer protection and provide the best experience for our players."
"Over the past few years, we’ve been making changes to ensure our ecosystem meets the expectations of our players and regulators, which we hope will be a helpful guide for others in our industry."
Epic added, "All game developers should rethink steps they’ve taken to simplify payment flows in favor of practices that provide the largest amount of clarity to players when they make purchase decisions. Saving payment information by default is a common way to streamline the checkout process, so players do not have to re-enter their payment method every time they make a purchase. We’ve agreed with the FTC to change this practice, and we now offer an explicit yes or no choice to save payment information."
"Pushing a button to complete a purchase is one of the most commonly used and easiest mechanics to complete online purchases. Games should go above and beyond to make sure players even more clearly understand when they are making a purchase with real money or with virtual currencies to prevent accidental purchases. We don’t want players to pay for something that they did not intend to."
A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012 and taking over the hardware estimates in 2017. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel. You can contact the author on Twitter @TrunksWD.
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Epic's own response makes them sound incompetent instead of malicious. I... don't think that's a great defense.
Without going deep on studying the case, this seem actually light punishment.
It really is nothing more than a slap on the wrist. Most big corpos these days can shake off a few hundred million, but if it was a fine of say 1-3 billion, then it'd start to do a bit of a dent.
Yep a few Billions could be more deterent.
Reading this, much of what they did sounds not only like stupid mistakes but obvious, like they knew what they were doing. Glad they are getting done for it. Hope some of that money goes back to the gamers.
Yeah sounds like they did a lot of bad thing. But that's also why I don't attach my credit card to anything.
Wonder how they chosen 520 million.
Honestly, the fine for this sort of practice should be alot more than $520m.
People whine when companies make it take a bunch of steps for them to buy something. Then people whine if companies make it too easy to buy something.
I understand that when there are kids involved people look at it a bit differently. But, there are zero kids that have credit cards. Parents have to be on top of this shit. Epic exists to make money. It's not on them to make sure that someone's children don't make purchases. That's on the children's parents. Epic's job is to try to get that money from people.
I think Epic is being screwed here. They didn't use trickery. They made it easy for people to give them their money, and then people did it. Then other people (mostly parents) didn't want to accept responsibility for spending money on the video game.
They bragged about how deep in the UI they had hidden the refund function. They appeared to strategically change which button was the purchase button and which was the view button, to increase the odds of accidental purchases. I went in to reading the documents prepared to give them the benefit of the doubt just like you, but the more I read the more it seemed pretty malicious to me.
Were they forced to refund those bills too? If not then this isn't much different than them just bribing the government to let them do it...
Hopefully this gets good media coverage on social media.
They'll do another round of investments from partners soon to cover this and Sony will stupidly invest another 250M to Epic in exchange for some positive PR statements from Tim Sweeney.
Or to slowly grow their participation on the company and dictates its direction.
Incredibly deserved. I hope more companies are hit with fines like this for their own predatory practices. Just wish the money was going back as refunds instead of into the US government's corrupt pocket.
Go after Diablo immortal next
I wish the FTC also slapped them with a fine for that totally gross and trash campaign of theirs, when they tried to rally kids like soldiers against Apple.
You just don't weaponize kids like that...
Ftc wins big bucks from this,
But can they win against Microsoft?
Epic manipulated the UI to encourage accidental purchases, and bragged about how deep in the system they had managed to hide the refund function.
Microsoft is proposing to buy one of the most terrible places to work in the games industry and overhaul their HR system, not stand in the way of them unionizing, increase the number of platforms Call of Duty is created for, and revitalize fan-favourite IPs that have sat moribund for far too long.
I don't see the connection that you're drawing.
I have never said Microsoft are saints. I've been VERY critical of them in the past, in fact.
However, I don't see any evidence that they're more corrupt than the average. I'd like a citation for that from you before I would consider conceding that point.
The problem with any publicly-traded corporation is that they have a fiduciary duty to maximize shareholder value. They are therefore legally required to put shareholders over their employees, the environment, or anything else. But that's no more true of Microsoft than it is any other corporation.
What's different here is that Microsoft appears see more value (for their shareholders) in staff retention than some of their competition, so Microsoft now has a reputation for paying much better than other companies in the game industry. And they appear to be choosing not to stand in the way of unionization, which is presumably a marketing technique with the public and/or a negotiating tactic to get the unions on-side with the Acti-Blizz purchase.
So they're not saints, they're maximizing shareholder value. And yet, their interpretation of how to do that is nonetheless bringing about some good stuff right now, IMO.
