Tech giant Adobe turned out to be is in the spotlight for its subscription cancellation policy. The U.S. Federal Trade Commission (FTC) recently filed new charges against the company, citing a purported statement by one of its top executives that likened subscription cancellation fees to “heroin” for Adobe, and described the revenue they generate as so significant that ending the practice would seriously harm the company’s business.
Adobe, however, strongly disagrees with these claims. The company’s general counsel, Dana Rao, issued a strong rebuttal. According to him, the quoted statement was not only taken out of context, but also belongs to the distant past. Moreover, Rao emphasized that the income from paid subscription cancellations is less than 0.5% of Adobe’s annual revenue. Therefore, he argues, these payments do not have a significant impact on the company’s business decisions.
It is worth noting that this case is a continuation of the June lawsuit filed by the US Department of Justice against Adobe, which accused the company of making the process of canceling subscriptions unnecessarily complicated.
In response to this criticism, Rao stated that a user can cancel a subscription in just 30 seconds if they wish. He also explained why the cancellation fee is not displayed when subscribing: the amount varies depending on when you cancel and is 50% of the remaining subscription fee.
When asked about the possibility of including the cancellation fee on the subscription page, Rao said that such an approach would result in an “overly cluttered user interface.” In his opinion, it would make the page even more confusing for consumers due to the excess of information.
In light of all of the above, the standoff between Adobe and US regulators continues. On the one hand, the company insists on the transparency of its policies and the insignificance of the income from paid subscription cancellations. On the other hand, US authorities continue to express concern about Adobe’s practices. The question remains: will the FTC and the Department of Justice be satisfied with the company’s explanations, or will Adobe be forced to make changes to its subscription policy under pressure from regulators?
