Bloomberg News reports that Amazon was sued by the Federal Trade Commission Wednesday. The FTC accuses the most well-known online retailer of deceiving millions of customers into enrolling in its Prime membership. It also said that once users signed up for Amazon Prime, they found it challenging to complete the cancellation process and alleged Amazon of having sabotaged the process.
What more does FTC accuse Amazon of?
The FTC cited the incidents above as evidence that the online retail shopping portal’s practices violated both the Restore Online Shoppers’ Confidence Act and the FTC Act. It alleged that the company had used “dark patterns” or deceptive tactics to sway consumers’ judgments and force them to become Prime members against their will.
According to Lina Khan, FTC Chair said that Amazon has been tricking people into recurring subscriptions without their approval. It has led to users needing more support and shelling out a significant amount of money. However, Heather Layman, an Amazon spokesman, claimed in a statement that the FTC’s allegations were untrue and unlawful.
Customers prefer Prime, as seen by the service’s popularity among users of the interface and convenience of use. Amazon spokesperson also said that as far as their products and services are concerned, they are constantly considering customer feedback and trying to improve user experience as much as possible, further explaining that facts should become apparent as the case proceeds. Following the same, the company’s shares dropped a little at the close.
FTC monitored Amazon’s signing and cancellation processes:
According to Bloomberg News, the Federal Trade Commission has been monitoring the Amazon Prime Program’s enrollment and cancellation procedures since March 2021.
When CEO Andy Jassy and Jeff Bezos had to testify regarding the company’s Prime membership standards, the FTC and the two executives disagreed. Although Amazon argued that it would be burdensome and unduly, it was rejected by Federal Trade Commission.
The Prime membership program was introduced in 2005. It is one of the most popular services in the world. And there are more than 200 million members of this subscription-based service across the globe. It is also one of the primary sources of revenue generation for Amazon. The cost of a Prime membership is $139 per year. It includes free shipping, perks, and you can access streaming content.
What problems did consumers face with Prime membership?
Amazon users found it challenging to purchase items on the website without Prime. Users had to click a button in order to complete the purchase. However, it was not made clear by doing so whether they also consented to pay a recurring subscription fee.
