U.S. Federal Trade Commission Sues Adobe Over Subscription Practices ⇥ ftc.gov

The U.S. Federal Trade Commission:

The Federal Trade Commission is taking action against software maker Adobe and two of its executives, Maninder Sawhney and David Wadhwani, for deceiving consumers by hiding the early termination fee for its most popular subscription plan and making it difficult for consumers to cancel their subscriptions.

A federal court complaint filed by the Department of Justice upon notification and referral from the FTC charges that Adobe pushed consumers toward the “annual paid monthly” subscription without adequately disclosing that cancelling the plan in the first year could cost hundreds of dollars. Wadhwani is the president of Adobe’s digital media business, and Sawhney is an Adobe vice president.

The inclusion of two Adobe executives as co-defendants is notable, though not entirely unique — in September, the FTC added three executives to its complaint against Amazon, a move a judge recently upheld.

The contours of the case itself bear similarities to the Amazon Prime one, too. In both cases, customers are easily coerced into subscriptions which are difficult to cancel. Executives were aware of customer complaints, according to the FTC, yet they allegedly allowed or encouraged these practices. But there are key differences between these cases as well. Amazon Prime is a monthly cancel-anytime subscription — if you can navigate the company’s deliberately confusing process. Adobe, on the other hand, offers three ways to pay for many of its products: on a monthly basis which can be cancelled at any time, on an annual basis, or on a monthly basis locked into an annual contract. However, it predominantly markets its products with the latter option, and preselects it when subscribing. That is where the pain begins.

The difficulty and cost of cancelling an Adobe subscription is legendary. It is right up there with gyms for how badly it treats its customers. It has designed a checkout process that defaults people into an annual contract, and a cancellation workflow which makes extricating oneself from that contract tedious, time-consuming, and expensive. If Adobe wanted to make it obvious what users were opting into at checkout, and easy for them to end a subscription, it could have designed those screens in that way. Adobe did not.