Amazon sued over ‘deceptive’ Prime subscription tactics – here’s what that means

If you’ve ever accidentally signed up for Amazon Prime or found the subscription tricky to cancel, you’re not alone – and now the retail giant is getting sued for what the US Federal Trade Commission (FTC) is calling “manipulative, coercive or deceptive” tactics.

The FTC, which is the US consumer rights watchdog, has sued Amazon over the retailer’s website design, which it claims has both “duped millions of consumers” into signing up for Prime and made the cancelation process “knowingly complicated”.

In the FTC case summary, the watchdog explains that it’s taking action against Amazon “for its years-long effort to enroll consumers into its Prime program without their consent while knowingly making it difficult for consumers to cancel their subscriptions to Prime”.

The FTC’s two main criticisms of Amazon are its user interface and cancelation procedures for Prime. It claims that Amazon uses design tricks known as “dark patterns” to “trick consumers into enrolling in automatically-renewing Prime subscriptions”.

(Image credit: Future)

The FTC highlighted Amazon’s checkout process in its press release, saying “in many cases, the option to purchase items on Amazon without subscribing to Prime was more difficult for consumers to locate”. It added that sometimes “the button presented to consumers to complete their transaction did not clearly state that in choosing that option they were also agreeing to join Prime for a recurring subscription”.

On Prime cancelations, the FTC said that “Amazon put in place a cancellation process designed to deter consumers from successfully unsubscribing from Prime”, noting that Amazon has “used the term “Iliad” to describe the process.

So what might be the end result of this case? The FTC says it’s “seeking a court order to force Amazon to change its practices”, along with “financial penalties in an unspecified amount”. Both of these could take a long time, though, with Amazon denying any wrongdoing.

Amazon responds

Amazon has a video (above) that shows you how to manage your Amazon Prime membership. (Image credit: Future)

Amazon has denied that it’s guilty of the practices raised by the FTC, including those so-called “dark patterns”. In a statement sent to TechCrunch, an Amazon spokesperson said: “The FTC’s claims are false on the facts and the law. The truth is that customers love Prime, and by design we make it clear and simple for customers to both sign up for or cancel their Prime membership” they said.

The Amazon spokesperson added that “we look forward to the facts becoming clear as this case plays out” and also criticized the FTC’s process stating that “while the absence of that normal course engagement is extremely disappointing, we look forward to proving our case in court.”

This case could, then, be a long-running one. Right now, Amazon Prime costs $140 / £95 / AU$79 per year, or $14.99 / £8.99 / AU$9.99 per month, and includes perks like free shipping and access to Amazon Prime Video, along with discounts on services like Amazon Music HD.

While that can certainly offer good value, particularly if you frequently buy products from Amazon, it’s also not an inconsiderable sum in these financially-trying times. And a separate report from Business Insider claims that when Amazon started the cancelation process referred to by the FTC, “the number of Prime cancellations dropped by 14% at one point in 2017 as fewer members navigated to the final cancellation page”.

The FTC’s case might ultimately force Amazon to make its Prime sign-ups and cancelation processes clearer, but until then you can follow our guide on how to avoid wasting megabucks on tech subscriptions.