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Competition authority turns its gaze on cloud storage players

Those firms providing cloud storage services will have to watch out for dodgy Ts&Cs with the Competition authority keeping a firm eye on the sector

The Competition and Markets Authority (CMA) is taking steps to ensure that users of cloud storage services are protected from unfair Ts&Cs.

The biggest worry that the CMA highlighted in its review of the sector was that those supplying cloud storage services could change the service or terms of the contract at any time, without notice and for any reason.

In extreme cases there were also fears that the supplier could terminate the service without notice or renew a contract without consulting the customer.

A number of suppliers have already agreed to elminate the most worrying aspects of their terms and conditions, including Dixons Carphone, JustCloud and Livedrive.

Having carried out its report, got a few firms to sign up to changing their ways the CMA has also penned an open letter to businesses to encourage more to follow suit.

In the letter the organisation advises those providing cloud storage to be clear about how their services would work: "We also had concerns about the transparency of contract terms. Some contract terms are written or structured in a way that makes it difficult for consumers to understand their rights and obligations under the contract."

Nisha Arora, CMA senior director, consumer, said that cloud storage was an attractive home for data but those using the services had to be treated fairly.

"Our review found that people find these services really valuable. However, we also heard some complaints resulting from unfair terms in contracts. If left unchanged, these terms could result in people losing access to their treasured possessions or facing unexpected charges," he said.

"In this rapidly-developing market, it’s important that we act now to ensure that businesses comply with the law and that consumers’ trust in these valuable services is maintained. We welcome the fact that a number of companies have already agreed to change their terms, and expect to see improvements from other companies," added Arora.

The worries about services being terminated without warning are not without foundation and Livedrive found itself in the firing line back in the summer of 2014 for closing user backup accounts because of apparent excessive storage use.

Read more on Storage-as-a-Service

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