FTC Investigation Against Proprietary Software (Adobe)
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Adobe faces probe into subscription cancellation rules
Digital subscriptions have been a recent focus for the FTC. It proposed a rule in March that consumers must be able to cancel subscriptions as easily as they sign up for them. “Too often, companies make it difficult to unsubscribe from a service, wasting Americans’ time and money on things they may not want or need,” US President Joe Biden said in a social media post at the time.
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Too Hard to Cancel? Adobe Faces Potential FTC Fine Over Product Subscriptions
Adobe disclosed the FTC investigation in a Wednesday SEC filing. The company says it’s been cooperating with the US regulator since June 2022 after it received a subpoena from the FTC.
According to the filing, the FTC is probing Adobe’s “disclosure and subscription cancellation practices relative to the Restore Online Shoppers’ Confidence Act,” which bars online vendors from charging users unless informed consent has been given.
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Adobe embroiled in anti-trust issues, forecasts revenue below estimates
Photoshop maker Adobe (ADBE.O) said on Wednesday it was facing regulatory scrutiny over its subscription models and forecast annual and quarterly revenue below estimates, sending its shares down more than 5% in after-hours trading.
The San Jose, California-based company said in a regulatory filing that since June 2022 it has been cooperating with the Federal Trade Commission (FTC) in response to a civil investigative demand seeking information regarding its disclosure and subscription cancellation practices.
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FTC investigating Adobe over making it too hard to cancel subscriptions
Adobe revealed the Federal Trade Commission (FTC) investigation in a regulatory filing with the Securities and Exchange Commission (SEC).
The SEC requires companies to disclose any material risks which might affect their profitability, in order to ensure that investors are making informed decisions. Adobe disclosed the investigation, stating that it may face penalties, other costs – and that its income might be affected.