Amazon Duped Millions Of Customers To Enroll For Prime Subscription 'Without Their Consent': US FTC In Court

JE Technology Desk: The United States Federal Trade Commission (FTC) accused the company Amazon of enrolling consumers in millions for its Prime subscription service without approval from them and complicating the cancellation process, according to news agency Reuters.

The commission filed charges against the e-commerce giant in a Seattle federal court, claiming that Amazon "knowingly duped millions of consumers into unknowingly enrolling in Amazon Prime." In response to the allegations, the company replied in a statement and said the charges are "false on the facts and the law."

The FTC alleged that Amazon deployed "manipulative, coercive or deceptive user-interface designs known as 'dark patterns' to trick consumers into enrolling in automatically renewing Prime subscriptions" and seeks 'civil penalties and permanent injunction' to avoid such cases in future, the report added.

In response, Amazon said, "The truth is that customers love Prime, and by design, we make it clear and simple for customers to both sign up for or cancel their Prime membership." It said the body filed a lawsuit without notice amid the discussions with the commission's staff.

The FTC iterated that Amazon's Prime service is the world's largest subscription model, which generates $25 billion in revenue/year. Benefits of the service include discounted deals, free shipping, music and movies catalogue, among other perks. The service has over 200 million users across the globe, and the US members infuse $139 per year and contribute to this revenue pie.

As per the lawsuit, after FTC pressed hard, Amazon altered its cancellation process. But despite this, the protocol "requires five clicks on desktop and six on mobile for consumers to cancel from Amazon.com."

On May 31, the FTC announced a $ 5.8 million settlement with the company after the commission said that Amazon's Ring doorbell camera unit was used to spy on customers. Later, the agency shared that the e-commerce platform agreed to a $25 million settlement for allegations of violation of privacy. The platform failed to delete recordings of Alexa upon request by parents and saved them longer than the necessary period, the report added.

The day of case filing coincided with the date of announcements of the Prime Day sale. Speaking of India, Amazon was recently in the news in India for introducing Prime Lite annual plan in India.

With inputs from Reuters