Changes effected on Xbox subscription auto-renewal policy after deliberations between CMA and Microsoft

by Don Sharpe
Don Sharpe
Don Sharpe
Don has been writing professionally for over 10 years now, but his passion for the written word started back in his elementary school days. His work has been... read more
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  • The CMA secured improvements for Xbox online players after concerns were raised about Microsoft’s use of auto-renewing subscriptions.
  • Memberships are billed automatically at the end of the initial contract period until you cancel your membership.
  • CMA’s main concern was that consumers were not aware of the ramifications of signing up for this service.

Microsoft has altered its practices in how it handles the automatic renewal of contracts for online gaming services.

The company offers the Xbox Live Gold and Game Pass products, which allow customers to access a library of games and play together online.

Memberships are billed on an automatic renewal basis. If you do not cancel your membership, your credit/debit card will be charged at the end of your initial contract period unless you contact them to cancel your membership.

As part of an investigation into the online console video gaming sector, the UK’s Competition and Markets Authority issued a statement regarding its concerns with Microsoft’s auto-renewing subscriptions. The concern was that consumers did not fully understand the implications of signing up for this service.

Agreeable terms

The CMA has secured undertakings from Microsoft which address these concerns. The new terms include:

  • Better upfront information: Microsoft will provide more transparent, upfront information to help customers understand their Xbox membership – making clear, for example, that the subscription will auto-renew unless the customer turns off auto-renewal; when the subscription will auto-renew; how much it will cost; and how the customer can receive a refund after an accidental renewal
  • Refunds: Microsoft will contact existing customers on recurring 12-month contracts and give them the option to end their contract and claim a pro-rata refund
  • Inactive memberships: Microsoft will also contact existing customers who haven’t used their memberships for a long time but are still paying. These customers will be reminded how to stop payments, and if they continue not to use their memberships, Microsoft will ultimately stop taking further payments
  • Better information about price increases: Microsoft will give clearer notifications of any future price rises, and will ensure people know how to turn off auto-renewal if they don’t want to pay the higher price.

Here’s what Michael Grenfell, the Executive Director of Enforcement had to say at the CMA:

“Gamers need to be given clear and timely information to make informed choices when signing up for auto-renewing memberships and subscriptions. We are therefore pleased that Microsoft has given the CMA these formal undertakings to improve the fairness of their practices and protect consumers, and will be offering refunds to certain customers.“

“Other companies offering memberships and subscriptions that auto-renew should take note, and review their practices to ensure they comply with consumer protection law.”

What are your thoughts on the new auto-renewal policies in place? Let us know in the comment section below.