Apple does not have a collection agency that will come after you to try and collect the amount owed. It will just sit there with a negative balance but you will not be able to download app updates or use the account for anything other than viewing the store. After a period of about two years, the account will be closed and any past purchases will no longer be able to be used as any new computers won't be able to be authorized to play them because the account is closed. iTunes is a low profit buisiness for Apple so they do not spend money on collection agencies or attorneys.
You can try and open a new account and be more careful with purchases. They may or may not have updated their system however to prevent users from doing this if they have negavtive balanaces on other accounts. They used to allow people to do this which resulted in people haveing hundreds of open accounts with negative balances.
Apple uses a delayed billng system and sometimes purchaes aren't charged against the card until a balance is reached of about $37. If there are no funds on the card then you get the negative balance and there can be no more purchaes or updates made on the account until the balance is paid. Other than the moment a credit card is added to an account, Apple does not perform periodic checks on the card to make sure there are funds, it just assumes there are and with the delayed billing, it's easy to get a negative balance.
Not sure where you got this information from but it makes no sense and is outright crap.
My friend had an outstanding balance and three accounts all on the same credit card. No one could make a purchase until the debt was cleared up. You say itunes is low profits for apple? PC and Mac users buy from itunes and your account with itunes is the app store too; those combined make more money than apple hardware that is sold annually--check the markets and you'll see.
Basically, what happned was he paid the debt on the one account with a gift card then everyone could use the card again. Also, he found out that the card was rejected because his address on the account in itunes changed and he never matched it to his new bank records.
Just like every other sales place, when you make a purchase, they ping your credit card's servers to see that your card is alive and has enough money on it to purchase stuff, in the terms it says for an amount up to the cost of your purchse or a bit higher. You get to download, then your credit card company takes it's time and pays apple when thier system puts the payment through on thier end. If I have 75 bucks left on my Visa, spend 25 in itunes, then go buy food for 25 I won't have enough money when Visa gets around to trying to pay itunes because there will be a test in the amont of 25 or itunes, and a test for food for 25, plus the pending payments in the amount of 25 and 25...... that equals 100 when I only have 75. Now my card is rejected because Visa knows I don't have 100. Until the holds clear, I am declined. That can take a few days.
If my address is wrong, like my friend's was, then nothing gets paid to iTunes. How can your card exsist if your address doesn't match? You live nowhere with no place to send a bill to.....
Also, just because you think that the amount is small and that is why they won't come after you is pretty niave. If there are a 50 thousand people that all owe 30 dollars each that's a lot of $$ and it's called "class action". They already have lawyers they pay all the time, so why not nail people for what they owe?
AND.... it's just rude to buy things and not pay for them in the end. Even if it was an accident, you should still pay, then ask for a refund. It's kind of like eating an entire meal in dinner then saying you never meant to eat it. It was selected, then brought to you, then consumed.
Do you know what resrtictions are on your phone or whatever--they help prevent accidents. My nephew uses my phone to play games, so I set those up and it's all good now. http://support.apple.com/kb/HT4213
Anway, it sounds confusing but makes sense so if you are confused about tests and holds then talk to your bank.
Of course it's wrong to buy things and not pay for them but your post above is emtirely wrong. The iTunes store doesn't work like any other store, They only "ping" your card at the moment you add it to your account. It does not do this with every purchase.
I know someone personally who owes the iTunes store nearly $5,000 and all they did was disable all those accounts (he made nearly 200 acciunts in four years) so that he could not make any purchases. They also banned all of his iPhones and computers by serial number so that he could not make any new accounts in the future, He eventually sold every computer and iPhone and got new ones to be able to make a new account. He hasn't scammed them since and his learned his lesson. This was back in October so I am sure this is one of the reasons why they are so strict on which prepaid cards can now be used in the store. He abused the system by using prepaid cards that had $1-2 left on them and since iTunes only preauthorizes $1, he was able to make purchases of about $37 quickly before iTunes tried to authorize the card and then find out it was not able to. He did this on and off since 2007. No collection agencys, no one sent letters trying to collect the debt, just disabled accounts and computers being banned from ever being anle to make new accounts and purchases. Thats how Apple deals with this abuse.
This forum is filled with questions and even a few complaints on how Apple bills cards using this delayed system. One person last week on these forums wanted Apple to bill after every purchase but they don't and never have.
That's just funny.
Right at the beginning of the terms it says they check your card when you make a purchase. Unless I agreed to different ones than every other person in the world....
It also says in there that credit cards--not pre paid crap cards are accepted. There's a section on fraud too. If your freind added those cards, knowing that he'd get music and never pay for it, then he's a criminal in my books. If he did that at a store in the physical world he'd be in jail.
Moral of the story: I'm glad you can read, hope your freind goes to jail.