Uncle Sam Elbow Drops Adobe With a Lawsuit

20 Jun 2024

Hey Hackers! It’s Jose here. I’ll be taking over Tech What the Heck this week while Sheharyar is out. So, get strapped in because we have a lot to talk about.

Adobe vs the U.S.

If you’ve ever used Adobe, you know that their products are good but their subscription method is god awful. It’s too expensive, especially for freelance beginners and hobbyists.

$60 a month is just too much for people who are either doing it for fun or don’t have enough experience to get paying gigs.

If you want to make the argument that Adobe is for professionals and you should only start using it when you’re years into your freelance career, then okay; I’ll concede that point.

However, my other problem with Adobe’s subscription is far more serious: It’s extremely predatory. And I’m not the only one who thinks so; Uncle Sam does too.

Adobe recently got sued by the U.S. government for harming consumers with their subscription model and their cancellation method.

Here’s an excerpt from the complaint filed against the company:

“For years, Adobe has harmed consumers by enrolling them in its default, most lucrative subscription plan without clearly disclosing important plan terms. Adobe fails to adequately disclose to consumers that by signing up for the “Annual, Paid Monthly” subscription plan (“APM plan”), they are agreeing to a year-long commitment and a hefty early termination fee (“ETF”) that can amount to hundreds of dollars. Adobe clearly discloses the ETF only when subscribers attempt to cancel, turning the stealth ETF into a powerful retention tool that by trapping consumers in subscriptions they no longer want.

During enrollment, Adobe hides material terms of its APM plan in fine print and behind optional textboxes and hyperlinks, providing disclosures that are designed to go unnoticed and that most consumers never see. Adobe then deters cancellations by employing an onerous and complicated cancellation process. As part of this convoluted process, Adobe ambushes subscribers with the previously obscured ETF when they attempt to cancel. Through these practices, Adobe has violated federal laws designed to protect consumers.”

To break it down for you, the U.S. government is alleging that Adobe is hiding secret fees and only springing them up on their customers when they try to cancel their subscriptions.

They’re specifically talking about Adobe’s “annual, paid monthly” subscription plan; which is supposed to be the cheapest of the three plans.

If you look at the screenshot above, you will notice that it says a fee will apply if you try to cancel it after 14 days. Any normal person would look at that and go “Oh, the fee couldn’t be more than a couple dozen dollars.” But nope.

People hoping to cancel their subscriptions have to pay “50 percent of their remaining annual subscription,” according to Ars Technica.

Here’s a more in-depth look at how much you would owe if you chose the “annual, paid monthly” plan and tried to cancel it.

A subscription that is supposed to be only $60 a month could cost you over $200 to cancel.

But the fees are one thing; another thing the U.S. government is accusing Adobe of is making the cancellation process too complicated.

In fact, they have an entire section in the complaint they filed titled “Adobe’s Unlawful Cancellation Practices.”

Here are some excerpts from it that immediately caught my attention.

“Locating and clicking on a “Cancel your plan” button does not result in cancellation. Instead, after users have clicked “Cancel your plan,” Adobe has forced them to undergo a convoluted process requiring several additional steps, some of which were wholly unnecessary to complete cancellation.”

“Additionally, consumers have had to navigate through several web pages, pop-ups, and offers designed for retention.”

“Many subscribers attempting to cancel via phone or chat have been subjected to a time-consuming and burdensome process.”

Although this all seems damning, Adobe won’t take it lying down.

Dana Rao, Executive Vice President, General Counsel, and Chief Trust Officer of Adobe, said in a statement:

“Subscription services are convenient, flexible and cost effective to allow users to choose the plan that best fits their needs, timeline and budget. Our priority is to always ensure our customers have a positive experience. We are transparent with the terms and conditions of our subscription agreements and have a simple cancellation process. We will refute the FTC’s claims in court.”

We’ll see how it goes for Adobe who, in the last two weeks, has fallen over 600 spots on HackerNoon’s Tech Company Rankings, going from rank 35 to 649.

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In Other News:

  • Tesla reportedly delays Cybertruck deliveries because of windshield wiper issues - The Verge

  • EV startup Fisker files for bankruptcy - TechCrunch

  • US pushing Netherlands, Japan to restrict more chipmaking equipment to China, source says - Reuters

That’s all for now, but we’ll see you next week!

Jose Hernandez, HackerNoon Editor

*All rankings are current as of Monday. To see how the rankings have changed, please visit HackerNoon's Tech Company Rankings page.*Tech, What the Heck!? is a once-weekly newsletter written by HackerNoon editors that combine HackerNoon's proprietary data with news-worthy tech stories from around the internet. Humorous and insightful, the newsletter recaps trending events that are shaping the world of tech. Subscribe here.*