It almost seems to have become standard these days that the services we sign up to make it as difficult as possible to cancel. This is certainly true of Adobe, which makes you jump through at least half a dozen hoops to actually stop sending them money.
The FTC has taken notice of this and is now investigating Adobe. The information comes as Adobe submitted a regulatory filing with the Securities and Exchange Commission (SEC).
Adobe under the magnifying glass
The SEC requires public companies to provide risks to their business in these filings. An FTC investigation would certainly be a potentially big risk to Adobe’s income. And it’s all over the difficulty of cancelling your Adobe Creative Cloud subscription.
The section of the filing outlining the FTC investigation reads:
Since June 2022, we have been cooperating with the Federal Trade Commission (“FTC”) staff in response to a Civil Investigative Demand seeking information regarding our disclosure and subscription cancellation practices relative to the Restore Online Shoppers’ Confidence Act. In November 2023, the FTC staff asserted that they had the authority to enter into consent negotiations to determine if a settlement regarding their investigation of these issues could be reached. We believe our practices comply with the law and are currently engaging in discussion with FTC staff. The defense or resolution of this matter could involve significant monetary costs or penalties and could have a material impact on our financial results and operations.
Adobe is notorious for its subscription cancellation difficulties. They don’t even send out renewal notices, either. You just wake up to find a payment has been taken from your account. So, you have to stay on top of your renewal dates yourself.
FTP Proposals for subscriptions
The FTC put forward proposals in March 2023, suggesting a new “Click to Cancel” requirement for managing subscriptions. The proposal included multiple changes designed to make it easier for users just to leave a service.
For a start, cancellation procedures should be simple. It should be no more difficult to leave a service than it was to sign up in the first place. While companies will still be allowed to offer you incentives to stick with them during the cancellation process, they’ll need to ask you if you want to see them first.
Right now, Adobe offers three months free subscription the first time you try to cancel your Creative Cloud account. They’ll still be able to do this under the FTC’s proposals, but they’ll have to ask if you want to see that offer before they actually show it to you.
And, of course, they expect sellers and services to send their customers an annual reminder, letting them know when their subscription will be renewed. They also expect sellers to do better when it comes to free trials that automatically enrol you into a subscription when they expire.
A sign of things to come?
The guidelines don’t just target Adobe, of course. The FTC wants these implemented across the board on all types of subscription services. Even gym memberships. But Adobe has cited the FTC as a risk. They say that they’ve been negotiating with the FTC since long before March’s proposals.
The trend towards complicated cancellation procedures has continued to grow over the past several years. While there are still some that let you subscribe and unsubscribe at will, a lot of them seem to make it very difficult to cancel. They still want your money.
Hopefully, the FTC’s proposals will start to reverse this trend. Because if it’s easy to sign up and disappear whenever I want to, I’m much more inclined to sign up.
[via 9to5Mac]
