The recent ‘duping’ allegations made against Amazon by the US Federal Trade Commission (FTC) in relation to the Amazon Prime program were foreshadowed by anticipatory EU actions dating back several years.

The prior activity was triggered by a Norwegian Consumer Council (NCC) investigation that was capped by a report headlined ‘You Can Log Out, But You Can Never Leave.’ In language echoed later by the FTC, the report alleged that “in the process of unsubscribing from Amazon Prime, the company manipulates consumers to continue using the service in what seems like a deliberate attempt to confuse and frustrate” them, which constituted unfair commercial practice.

EU issued mandates ahead of FTC

Subsequent discussions with the European Commission (EC) and multiple national consumer protection authorities resulted in Amazon agreeing to implement changes to its Prime cancellation procedure to comply with EU mandates. Anticipated to start from 1 July 2022, required modifications applied to the Prime web interface on all EU websites, and for all devices, enabling consumers to unsubscribe from Amazon Prime with only two clicks by way of a prominently displayed ‘cancel button.’

Both cases illuminate a fundamental customer relationship dilemma faced by any kind of digital subscription service provider: When and how do attempts to convince a paying customer not to unsubscribe become legally questionable?

As the NCC initially pointed out, the EC then confirmed, and the FTC later reiterated, the crux of the issue seems to pivot on ‘dark patterns,’ namely, simple features of interface design that exploit common human cognitive biases to push, or nudge, users into making choices that preponderantly benefit the platform in question, “often at the cost of the individual’s money, time and/or privacy.”

A retail juggernaut like Amazon can afford – both literally and figuratively – to be recalcitrant in co-operating with regulatory authorities on these kinds of disputes, but for most other players in the subscription services space, the risk ultimately outweighs the reward.

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By GlobalData