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What Is Subscription Trap?

All of us are familiar with subscriptions of the following type:

  • Social network e.g. LinkedIn Premium
  • Digital media e.g. Wall Street Journal
  • Streaming video service / OTT e.g. Netflix
  • Hosting service e.g. Hostgator
  • SAAS software e.g. Salesforce

A subscription is for a given plan at a fixed monthly fee. When you sign up for it, you typically submit details of your credit card ("credit card on file") to a brand or service provider ("Merchant"). Terms and Conditions of most subscriptions include a so-called "electronic-mandate", which authorizes the merchant to charge the fixed monthly fee to your credit card every month without taking your approval for each recurring payment.

PSA: Free Trial is a myth if you pay with Debit Card, UPI, etc. - your money leaves your bank account even before your trial has begun. OTOH, if you pay with Credit Card, free trial is truly free for the entire trial period. Source: @ETPrime_com

Many of us set up auto debits on our credit card or bank accounts to pay for electricity, cloud infrastructure, Google Ads, and other ongoing services. But they're not treated as subscriptions because their bills vary from one month to another. In a subscription, monthly fees are fixed and agreed in advance.

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Cue to a few weeks or months after you signed up for a subscription. Let's say you no longer want the service any more.

This can happen for a variety of reasons e.g.

  • The free trial period has expired and you're not interested in upgrading to the paid version
  • You've binge watched your favorite show OR your favorite show has suddenly become "unavailable", so you don't have any use for the OTT going forward
  • You discover that paid does not mean ad-free, and you've had it with all the ads you still keep seeing (cf. chat transcript of this New York Times cancellation conversation).

At that stage, you'll want to cancel the subscription.

If you're made to jump through many hoops at this stage - or, in the worst case, you're not able to cancel at all - you've fallen into the so-called Subscription Trap.

I don't want to sound alarmist but subscription traps are quite common these days.

Subscription Trap Fraud: People buy what they think is a free trial of a product but unwittingly get signed up for a pricey monthly subscription that uses #RoachMotel tactic to become virtually impossible to cancel.

From personal experience and anecdotal evidence, here are the challenges you might face while trying to cancel a subscription:

#1. You hit the cancel button on the website. Instead of receiving an instant confirmation that your subscription is cancelled, you're ferried around from one screen to another with all kinds of dumb questions and confusing error messages. Alternatively, a chatbot pops up and gives you all kinds of advice on how to avoid the problems you're facing that led you to cancel the subscription (e.g. how to turn off ads).

It is really hard to cancel a @nytimes subscription. There should be a law requiring easy cancellation of any consumer subscription.

#2. There's no CANCEL button on the website. Although you bought the subscription online, you need to call a Hong Kong / Argentina number to cancel it. When you burn through costly ISD call rates, you're put on hold for 30 minutes, and then subject to all kinds of cross sells for another 15 minutes before the CSR processes your cancellation request.

WSJ made me call from Argentina and talk with someone for ten minutes or so just to cancel my digital subscription. I felt stupid for being so naive. Never again.

#3. You're locked out of the website. Forget about cancelling the service, you can't even enjoy what you're paying for. Click here for a couple of examples of service providers who engage in this most egregious form of subscription trap. Special place in hell for them.

#4. You're told to send your cancellation request in writing to an email address that doesn't - ahem - accept incoming emails.

#5. The only way to cancel is to send your ID proof by snail mail to an address in Scottsdale, Arizona, and wait for months to hear back.

The term for the hoops you're made to jump through in the aforementioned situations is Dark Pattern a/k/a user interfaces designed to trick consumers. Click here for a list of various types of dark patterns.

The most common type of Dark Pattern is Roach Motel. Derived from the iconic line "you can check in anytime but you can't check out" in the classic rock number Hotel California, Roach Motel is ubiquitous and is present in all of the above illustrations of subscription trap. Other common Dark Patterns are Sneak into Basket and Bait and Switch.

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We've seen various types of subscription traps in this post.

Obviously, no subscriber wants to be caught in them.

Good news is, it's possible to escape subscription traps. We'll explore ways to do that in a follow-on post.

Watch this space!

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