If you charge them, you must tell them what they were charged. Or you should rethink charging them!

by Michael S. Kaplan, published on 2012/10/15 07:01 -04:00, original URI: http://blogs.msdn.com/b/michkap/archive/2012/10/15/10359497.aspx


Someone forwarded me an article the other day that I found to be a fascinating warning for everyone about the dangers of handling the issues of World-Readiness and International Marketplaces that are not carefully considered for geopolitical sensitivity.

The article is האם אפל עוברת על החוק בישראל?‏ (rough English translation from someone whose Hebrew is quite rusty -- me! -- would be "Is Apple the Law in Israel?").

You can read the full article.

Or use Internet Explorer's "Translate with Bing" right click menu option. Or the Microsoft Transator

Or for the sake of irony, you can use try to use Google or Apple translation features, given how poorly they "translated" the legal requirements in the market!

The article talks about the fact that it is the law in Israel that if you run a store on the Internet that targets customers in Israel (e.g. the way they called the page the "Israeli iTunes Store"), then there are basically three rules:

  1. Make sure all money is properly charged using standard rules of international commerce, and
  2. Make sure all licensing rules about content in other jurisdictions are respected, and
  3. Make sure all money is properly represented in local currencies so that users can be kept informed of what they are actually paying.

While the first point has worked well to protect the companies from being hit with huge class action lawsuits and the second point has worked well to protect the content providers from levying their own deep-pocketed lawsuits on the companies, it seems that they are not quite as fast with the third point over at Apple and Google, when it comes to protecting the customers.

From a common sense engineering standpoint, the argument on its face seems preposterous, including the dspecious argument that that they have no control over third parties.

If that's true, Google needs to add huge disclaimers about their unsafe marketplace if they can't protect their customers here, and the safety of Apple's own walled gardens would be called into question.

The article also talks about a similar situation in Taiwan that both companies appealed; after losing the appeal, Apple complied with the order while Google chose to block the Taiwan marketplace, instead.

So I guess we know where they stand in such cases.

When I think about Claudia's HTC Rhyme running Google's Android, I'm not as worried since she doesn't install apps. I'll be moving her over to Windows Phone and a Nokia Lumia soon, anyway. :-)

If you have he ability to charge them, you have the ability to tell them what they were charged,

Res ipsa loquitur (the thing speaks for itself).

Trying to settle it by saying that they can return the product and/or delete the app within seven days for a refund is basic ignorance of the fact that most people don't watch their credit card bills that closely, or even that often.

How are they supposed to trust you, if that is your approach?

The seller is being told that all three types of transparency are required, so the seller is required to at an absolute minimum tell them after purchase what they were charged at time of purchase in their local currency, with an option to cancel right away if they did not understand the amount.

Obviously it would be even better to tell them beforehand, but there are genuine engineering and customer satisfaction challenges that can make such a full solution more difficult, so I think the "tell me right after and let me reconsider when you do" is an acceptable compromise.

Either that or putting up huge trusts run by local governments to settle with ripped off customers, though I imagine the former would be preferred for a whole host of reasons!

When I look at our own forays in this area, in the XBOX Live marketplace, the Windows Phone store, and the Windows Store, it seems like we do much better here.

And I know for fact that both concern about fear of the consequences of messing up here is one of the main issues that kept the Zune store out of so many international markets in the early days.

Certainly Amazon has a good handle on this, and they (for me at least) revolutionized getting music imports with added tracks back in the day.

PayPal, eBay, and others did well here too, FWIW. As do others. So they get some kudos, even if for them it was just about avoiding big lawsuits.

If we were having problems like this here, both me and many others would be raising the alarm bells, as we did in the early planning days when the ideas of building these stores first came up.

I don't know about the rules of other companies, but behind the hilariously over-acted "Standards of Business Conduct" training videos we have to review every year is the serious truth of the consequences of such ethically questionable decisions.

How could we expect our own third parties or customers to trust our stores if we don't do this right?

Attn: Apple and Google -- World Readiness is about being ready FOR THE WORLD. And all of it's laws. And it's citizens.


Alex Cohn on 16 Oct 2012 8:12 AM:

The article says that only Apple ignores the requirements of the Israeli law of consumer protection. And I can confirm, the pricez in Google Play Store are displayed in ₪

Another correction: the title reads "Is Apple violating the law in Israel", or with some poetical extrapolation, "Is Apple above the law in Israel?"

Simon Buchan on 17 Oct 2012 6:40 AM:

Valve's Steam is interesting here - I hear they show prices in British Pounds and in Euros in those regions, but at least in Australia and New Zealand, *both places that also use a '$'* - they use USD! Worse, (most) games look like they're 40-50% of the local brick & mortar store prices, when they're closer to 70-80%! (Of course, 80% is still a better deal...). Fortunately, the price shown next to the "Add to cart" button and the totals in the cart put the "USD" at the end, so if you are paying at least a little attention you're not going to be mislead....

I imagine they at least comply with these legal requirements, though, since they have the implementation done....

Daniel on 17 Oct 2012 11:30 AM:

When a card is charged in a currency different from the account behind it, the currency conversion is up to the card company and bank behind it. The seller has no idea how much the customer was eventually charged in their local currency.

Here, Apple also lists and charges for iTunes Store purchases in EUR, which is different from the local currency. The catch is I don't even get to know right after they charge me for the purchase how much I precisely spent. It takes a couple days for the bank to finalize transactions, and it applies the exchange rates in effect on that future day. Best you can do is a rough estimate, hoping the exchange rates don't change much in the next few days.

Interestingly, for hardware purchases at the online Apple Store, they are able to display and charge prices in the local currency.

Still, most people are content with things as is and are not clamoring for local currency pricing for digital goods. Pretty much without exception we end up worse when a service adopts local currencies. For example, Microsoft and Xbox Live. Paying in USD and being a pretend-American, prices were lower even with the exchange rates applied by your bank. Now we have the luxury of knowing in advance precisely how much we are getting charged for… more than we used to be.


go to newer or older post, or back to index or month or day