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Google and Microsoft are among the major cloud providers yet to commit to the government’s push for fairer terms and conditions for online storage customers.
The government-backed Competition and Markets Authority (CMA) is calling on cloud storage firms to commit to introducing fairer terms and conditions for customers. This is to prevent them being caught out by sudden price hikes, unexpected service terminations and unscrupulous auto-renewal tactics.
Computer Weekly contacted Google, whose Drive service offers users 15GB of free online storage, for clarification on its support for the CMA’s call for commitment, but had not received a response at the time of publication.
Microsoft, which offers users access to online storage via its OneDrive service, declined Computer Weekly’s request for comment.
The competition watchdog also published an open letter to the cloud storage community, urging them to review their terms, and demands that customers are given sufficient information before they sign up about what their rights are.
Otherwise, the letter warns, cloud storage firms could find themselves at risk of enforcement action from the CMA or Trading Standards for violating the Consumer Rights Act 2015.
Read more about cloud and consumer rights
- Cloud storage firms that drastically increase their prices or renege on promises of unlimited capacity could find themselves in breach of consumer law, government competition chiefs warn.
- European cloud users should brace themselves for further price hikes, after Microsoft confirmed plans to charge enterprise users more to use its off-premise products from 1 August 2015.
“If a term is not fair, it will not be legally binding on a consumer and you are at risk of enforcement action,” the letter states.
“Having clear and fair terms will save you time, help prevent disputes and reputational damage, and protect your business if something goes wrong.”
A spokesperson for online file sync and share service Dropbox confirmed to Computer Weekly that it is supporting the CMA in its work, and prides itself of ensuring its terms and conditions are easy for users to follow and understand.
“We have been participating in the CMA’s industry wide review of cloud storage providers and their respective terms of service,” said the spokesperson.
“We have always taken care to draft terms in a manner that invites consumers to read and understand them — we try to write in plain and concise language that conveys a conversational tone.
“We look forward to continued engagement with the CMA and to helping address the concerns they have raised to the industry as a whole.”
Enforce and reform
The CMA’s open letter is the result of a consultation, embarked on by the Competition and Markets Authority (CMA) in December 2015, which sought to verify if the business tactics of cloud storage providers could be considered in breach of consumer law.
The work resulted in the publication of a 218-page report into the cloud storage sector’s compliance with consumer law, and sheds some light on why the CMA has moved to act on the way some firms operate in this market.
For example, a CMA poll of nearly 4,000 UK adults revealed that 27% of UK consumers use cloud storage, with the vast majority relying on free services to backup data and ensure it can be accessed across multiple devices and operating systems.
Nine out of 10 users (87%) have never experienced a problem with their chosen provider, the CMA report states, but certain “terms and practices” have come to light that have given the organisation cause for concern.
“If left unchecked, we are concerned these terms and practices have the potential to cause further harm to consumers in the future,” the report continued.