The Competition and Markets Authority (CMA) is concerned a proportion of cloud storage providers could breach consumer protection law in their terms and conditions, as well as business practises.

Alongside the report, the CMA has sent an open letter to all cloud providers outlining guidance on how the organization can ensure they remain true to the Consumer Rights Act 2015, as well as advice to consumers on the topic.

The concerns are mainly focused around three areas. Firstly, some cloud providers are currently able to change the service or the terms of the contract without giving customers prior notice. Secondly, the cloud provider currently has the ability to suspend or terminate the contract without notice for any reason. And finally, cloud providers are able to automatically renew a contract at the end of a fixed term without giving notice or withdrawal rights.

“Cloud storage offers a convenient means of keeping family photos, favourite music and films and important documents safe, and accessing them quickly from any device,” said Nisha Arora, CMA Senior Director for Consumer. “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.

“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.”

Although the CMA has not confirmed which cloud providers were potentially in breach of consumer protection law, it did comment Dixons Carphone, JustCloud and Livedrive have committed to changing their terms, as well as business practises.

The CMA also commented that while they were confident there would not be any breaches of consumer protection law following the report, any non-compliance in the future could lead to enforcement action and the CMA could apply to a court for an enforcement order. If that were breached it could be contempt of court and lead to an unlimited fine.