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In the name of consumer protection, a slew of U.S. federal agencies are working to make it easier for Americans to click the unsubscribe button for unwanted memberships and recurring payment services.
A broad new government initiative, dubbed “Time Is Money,” includes a rollout of new regulations and the promise of more for industries spanning from healthcare and fitness memberships to media subscriptions.
“The administration is cracking down on all the ways that companies, through paperwork, hold times, and general aggravation waste people’s money and waste people’s time and really hold onto their money,” Neera Tanden, White House domestic policy adviser, told reporters in advance of the announcement.
“Essentially in all of these practices, companies are delaying services to you or really trying to make it so difficult for you to cancel the service that they get to hold onto your money for longer and longer,” Tanden said. “These seemingly small inconveniences don’t happen by accident—they have huge financial consequences.”
Efforts being rolled out include a new Federal Communications Commission (FCC) inquiry into whether to impose requirements on communications companies that would make it as easy to cancel a subscription or service as it was to sign up for one.
The Federal Trade Commission (FTC) in March 2023 initiated a “click to cancel” rulemaking requiring companies to let customers end subscriptions as easily as they started them. The government already has launched several initiatives aimed at improving the consumer experience.
In June, the Justice Department, referred by the FTC, filed a lawsuit against software maker Adobe and two of its executives, Maninder Sawhney and David Wadhwani, for allegedly pushing consumers toward the firm’s “annual paid monthly” subscription without properly disclosing that canceling the plan in the first year could cost hundreds of dollars.
Dana Rao, Adobe’s general counsel, said in an emailed statement that Adobe disagrees with the lawsuit’s characterization of its business and “we will refute the FTC’s claims in court.”
“The early termination fees equate to minimal impact to our revenue, accounting for less than half a percent of our total revenue globally, but is an important part of our ability to offer customers a choice in plans that balance cost and commitment,” Rao said.
This article was provided by The Associated Press.