UK launches investigation on services provided by Cloud Storage Companies

United Kingdom has asked The Competition and Markets Authority (CMA) to investigate on the issue that some cloud storage and service providers were breaching consumer laws. It cleared the air that it was conducting this investigation based on a number of complaints received by it that prices can go up after a customer signs a contract or that the amount of data storage at the signing date may get sliced after the agreement.

In an early period this year, Office for National Statistics UK said that over 40% of UK adults now use cloud storage. Users of lap-tops, mobiles and tablets are increasingly taking advantage of such services, to store photos, documents, TV programs and films.

By storing such files in the cloud, rather than on the device itself, users get more memory, and the ability to access them from anywhere in the world.

Usually cloud storage providers offer a certain amount of IP Storage for free, but can charge up to £40 a month for extra gigabytes.

Amongst the biggest providers are Dropbox, Google Drive and Apple’s iCloud which offer a certain amount of cloud storage for free and charge when users ask for more.

It is when the user demands for more does the problems such as changing the storage capacity and indulging in black hat service activities start.

Now, UK’s CMA will keep an eye on all such practices and if necessary block the cloud services in the region, if at all they are found guilty.

United Kingdom’s The Competition and Markets Authority is particularly concerned about-

  • Unexpected price increases, after a contract has been taken out
  • Changes or reductions to unlimited storage capacity deals
  • Consumers’ data being lost or deleted
  • How contracts are automatically renewed at the end of the period
  • What happens to consumers’ data when they cancel a contract

“If our review finds breaches of consumer protection laws, we will take further action to address these issues”, said Nisha Arora, Senior Director of CMA. She added that CMA’s consultation on the issue will be open until January 15, 2016 and initial report findings will be available to media by May 2016.

Users can also share their bitter experiences along with valid proof with CMA and all those experiences will be included in the initial report released in May 2016 after a complete enquiry.

The law on price transparency has been tightened since the Consumer Rights Act came into force on October first week this year.


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