10 Mar 2017
CMA closes review of compliance with consumer law in cloud storage sector following commitments
On 17 February 2017, the Competition and Markets Authority (the “CMA”) brought to a close its review, launched in December 2015, of compliance with consumer law in the cloud storage sector following commitments from Amazon, Apple and Microsoft to make changes to their terms, in addition to the seven other storage providers who have previously agreed to do so. The changes they agreed to can be found here and include the following:
- ensuring that customers receive sufficient notice of any material changes;
- providing customers with rights to refunds and cancellation in the event of material changes;
- ensuring that customers receive sufficient notice before any suspension or cancellation of services.
Cloud storage services allow customers to store, organise and manage their digital content. The CMA found that approximately 3 in 10 adults in the UK use such services, and of these, the majority use and are satisfied with the free services that come with their smartphones and tablets. This is a fast-growing sector, estimated to be expanding by more than 20% a year globally. Cloud computing was highlighted as a specific area of interest in the CMA’s Strategic Assessment, and cloud storage services are seen as a dynamic and growing aspect of that. The CMA launched its review of compliance with consumer law in the cloud storage sector following reports that some consumers were experiencing difficulties with these services. The CMA’s report can be found here.
The CMA has stated that it remains interested in unfair terms and conditions, especially in the digital sector. It has published an open letter to businesses, highlighting certain potentially unfair terms. Companies in the cloud storage sector, and other technology-driven sectors, would be well-advised to review their terms and conditions to ensure they comply with consumer law.