US sues Adobe over subscription fees

The US government sued Photoshop maker Adobe for allegedly concealing expensive cancellation fees.

File photo: Adobe Photoshop web version

Adobe faces complaint

Based on the Federal Trade Commission's (FTC) complaint filed in San Jose, California federal court, subscribers of Adobe would have to pay hundreds of dollars when they decide to terminate their subscription plans. It said Adobe buries the fees in fine print or behind text boxes and hyperlinks.

The FTC also claimed that Adobe subscribers are forced to navigate through numerous pages when canceling online, while customers using phone calls are sometimes disconnected.

It added that subscribers experience "resistance and delay" from Adobe representatives.

Adobe trapped customers into year-long subscriptions through hidden early termination fees and numerous cancellation hurdles. Americans are tired of companies hiding the ball during subscription signup and then putting up roadblocks when they try to cancel, said Samuel Levine, director of the FTC consumer protection bureau.

Reacting to this development, Dana Rao, Adobe's general counsel and chief trust officer, said the group would face these claims in court.

Subscription services are convenient, flexible and cost effective to allow users to choose the plan that best fits their needs, timeline and budget. We are transparent with the terms and conditions of our subscription agreements and have a simple cancellation process, Rao said.

As of the end of March, subscriptions accounted for USD 4.92 billion, or 95 percent of Adobe's revenue.

Source: Reuters