Amber Neely
Adobe could face hefty fines related to its overly difficult and costly subscription cancellation practices due to an ongoing Federal Trade Commission Probe.
On its quarterly financial call, Adobe told investors it has been cooperating with FTC staff since June 2022. The FTC believes Adobe may violate the Restore Online Shoppers' Confidence Act.
"We have been cooperating with and engaging in discussion with the FTC staff regarding our disclosure and subscription cancellation practices," Adobe said in a statement seen by The Wall Street Journal.
Adobe asserts that it believes its practices comply with the law.
Adobe has long been scrutinized for how it handles subscriptions — and even more for how it handles canceling them. Unless a potential subscriber reads the fine print, it's easy for them to get trapped in an expensive situation.
When a user subscribes to something Adobe offers, they're given three options to pay: monthly; annual, paid monthly; or annual, paid upfront. Here's what each of those options means.
Monthly subscription: The most expensive option, Adobe's monthly subscriptions are often twice the cost of the other subscription options. However, if a user needs to cancel the subscription, Adobe does not charge a fee.
Annual subscription, paid monthly: Typically half the price of the standard monthly subscription, Adobe allows users to subscribe at the yearly price while still paying monthly. The downside is that Adobe will charge 50% of the remaining contract if canceled.
Annual subscription, paid upfront: Users may also choose to pay upfront for a full year of service. While this has advantages, such as preventing surprise billing, Adobe warns users that there are absolutely no refunds on this plan after the first 14 days.
Regulators are cracking down on companies with unclear subscription practices. Notably, the FTC wants to make canceling subscriptions anywhere on the web easier, easing the burden on customers who may not wish to use a service anymore.
At present, there is no uniformity in subscription cancellation procedures. Consequently, customers may go through lengthy and complicated cancellation processes or call or visit the company in person to cancel a service. The FTC is working towards standardizing these procedures to make them more customer-friendly.
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13 Comments
Maybe costly but not difficult. You can cancel any time very quickly and in a straightforward process. I cancelled my subscription a month before it ended without a hassle. I think the first two options, monthly, and yearly paid monthly, are fair. For the yearly paid monthly I think it is fair to give back the discount. The annual subscription paid upfront should have the same 50% penalty. I don't see why it should be any different than the yearly subscription paid monthly.
The problem I have with a subscription for Acrobat Pro is that they keep changing things and you end up spending an inordinate amount of time trying to figure out why suddenly you can’t do something anymore. There is a lot of backlash for this on their discussion forums.
The Adobe Stock subscription is a pain point for me personally. Most services will allow you to keep any unused credits until they are used, or until the next monthly bill would have been due. Much like cancelling Netflix in the middle of the month, you still get to use the service you paid for until the next billing cycle. Cancelling Adobe Stock means you lose any unused credits immediately, forcing you to hold on to the subscription in hopes of using the credits before the next billing cycle.
Unfortunately, many companies use various tactics to trap you. Apple's App Store makes it far easier and is a model that should be mandated.