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'Free-to-play' could be outlawed after EU shake-up

Definition of 'free' may soon only apply to apps that are completely free, with no payment options

State officials in Brussels want tighter European regulations on the advertising of free-to-play games, after describing the advertising of such apps as "misleading".

The European Commission - effectively the governmental arm of the EU - claims that it has heard complaints regarding free-to-play games from "all over Europe". On Thursday and Friday, the executive arm will meet with representatives for the games industry to discuss its concerns.

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Numerous analyst firms have calculated that the vast majority of mobile revenues come from in-app purchases

Claims made by EC ministers suggest the term "free-to-play" may soon only apply to games that are completely free.

EU justice commissioner Viviane Reding said "misleading consumers is clearly the wrong business model and also goes against the spirit of EU rules on consumer protection".

"The European Commission will expect very concrete answers from the app industry to the concerns raised by citizens and national consumer organisations."

It is estimated that the smartphone app business employs about one million people across Europe and generates about £50 billion ($83bn) in sales per year. However, successive analyst reports over the years have suggested that the majority of app revenues are made from the free-to-play model.

A statement from the European Commission wrote: "For the app economy to develop its full potential and continue innovating, consumers need to trust the products. At present over 50 per cent of the EU online games' market consists of games advertised as 'free', although they often entail, sometimes costly, in-app purchases."

How games industry officials negotiate their position will be a determining factor in the Commission's outcome.

But the governing body appears to be pressing hard on the matter. It states: "Children are particularly vulnerable to marketing of 'free to download' games which are not 'free to play'."

Commissioner Neven Mimica, who is responsible for consumer policy, said "consumers and in particular children need better protection against unexpected costs from in-app purchases".

The commission has also issued its position on the matter, stating clearly that it wants the term 'free-to-play' to be outlawed for games that are not.

"The use of the word 'free' (or similar unequivocal terms) as such, and without any appropriate qualifications, should only be allowed for games which are indeed free in their entirety, or in other words which contain no possibility of making in-app purchases, not even on an optional basis."

In July 2012, former EA chief executive John Riccitiello told company investors that free-to-play was a misleading term, as well as a lucrative business model.

"There's a lot of power in free-to-play," he said.

"And by the way, for what it's worth, free-to-play is anything but free. We have lots of games that are 'free-to-play', where paying users are giving us ten, twenty, thirty dollars a month.

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