The American consumer protection agency accuses the online retailer Amazon of “manipulative” means so that customers take out paid “Prime” subscriptions. Terminations are said to have been made more difficult for them.
The US consumer protection agency Federal Trade Commission (FTC) has sued Amazon over allegations that the US group had forced its paid subscription “Prime” on customers. For years, the e-commerce giant has tricked “millions of consumers” into unknowingly signing up for Amazon Prime without their consent, the FTC said.
The company also “knowingly” made the procedure for terminating Prime more difficult, according to the agency. In a statement, Amazon called the FTC’s allegations “factually and legally incorrect”.
accusation of “manipulative” design surfaces
The lawsuit in federal court in Seattle is one of several measures taken by US President Joe Biden’s administration to curb the market power of big tech companies and increase competition to protect consumers.
The e-commerce giant has used “manipulative, compulsive or deceptive” design interfaces — known as “dark patterns” — to get customers signed up for “Prime” plans, which automatically renew, according to the FTC. Although his cancellation process has since changed, “five clicks on desktop and six on mobile” are still required to cancel.
“Amazon has lured and trapped people into recurring subscriptions without their consent, which not only frustrates users but also costs them a lot of money,” said FTC Chair Lina Khan. The agency is asking for civil penalties and a permanent injunction to prevent future violations.
“Prime” largest subscription program in the world
According to the US Consumer Protection Agency, “Amazon Prime” is the largest subscription program in the world with annual sales of 25 billion dollars. Its 200+ million members get fast, free shipping on items, discounts, and access to movies, music, and TV shows.
“Prime” members in the United States currently pay $139 a year and are responsible for a large part of Amazon’s sales. In Germany, the “Prime” membership costs 89.90 euros per year.
In a statement, Amazon said: “The truth is, customers love Prime and we designed it to make it clear and easy for customers to sign up for or cancel a Prime membership.”
termination process called “Iliad”.
According to the FTC complaint, consumers who wanted to cancel “Prime” had to navigate a maze. Amazon itself referred to the termination process as the “Iliad,” referring to Homer’s epic poem about the protracted Trojan War. “The primary goal of the Prime cancellation process was not to allow subscribers to cancel, but to stop them,” according to the FTC.
It’s not the first time Amazon has had trouble with the Consumer Protection Agency. On May 31, the FTC announced a $5.8 million settlement with Amazon’s doorbell camera service, Ring. The agency had previously determined that the cameras had been used to spy on some customers.
Allegations about Alexa
In addition, the FTC accuses Amazon of violating the privacy rights of children with the virtual assistant Alexa. The group does not delete Alexa’s recordings at the parents’ request and keeps them longer than necessary.
As part of the settlement, Amazon had agreed to pay a civil penalty of $25 million. The group should also delete inactive child accounts as well as certain voice recordings and location data.