An update on the FTC
In June, the FTC filed a lawsuit about Adobe’s subscription business practices. The FTC has now published an updated version of the complaint, unfortunately taking four-year-old conversations and details from employee emails out of context to supplement their claims.
In June, the FTC filed a lawsuit about Adobe’s subscription business practices. The FTC has now published an updated version of the complaint, unfortunately taking four-year-old conversations and details from employee emails out of context to supplement their claims.
Context & Background
At Adobe, we’ve always prided ourselves on being a company that looks around the corner to solve the hard problems our customers face. We reimagined the creative process by pioneering a new subscription service model, which enables us to provide a continuous stream of innovation in our products, allow seamless collaboration between our users, and create direct integrations into cloud services like fonts, libraries, and Adobe Stock.
We have always prioritized giving our customers the flexibility to choose the plan that best fits their needs, timelines, and budgets. This includes offering multiple types of plans where customers can choose between lower upfront costs and maximum flexibility. We offer a monthly plan that consumers can use and can cancel at any time with no fee. We provide an annual option for those customers who want to make a yearly commitment to our products in exchange for a lower price. We also offer an annual plan where customers can pay in monthly installments for those who cannot make the up-front payment. This annual billed monthly plan comes with a fee that is representative of the difference between the price of our monthly plan and the price of the discounted annual commitment plan, if customers decide to terminate their contract early.
We are committed to transparency with our customers, including in our terms and conditions, and to providing them with a great customer experience. As a pioneer in this space, we are continually listening to feedback to improve our customers’ experience and make changes to our design, processes and policies in response, as we have done repeatedly over the years.
At Adobe, we’ve always prided ourselves on being a company that looks around the corner to solve the hard problems our customers face. We reimagined the creative process by pioneering a new subscription service model, which enables us to provide a continuous stream of innovation in our products, allow seamless collaboration between our users, and create direct integrations into cloud services like fonts, libraries, and Adobe Stock.
We have always prioritized giving our customers the flexibility to choose the plan that best fits their needs, timelines, and budgets. This includes offering multiple types of plans where customers can choose between lower upfront costs and maximum flexibility. We offer a monthly plan that consumers can use and can cancel at any time with no fee. We provide an annual option for those customers who want to make a yearly commitment to our products in exchange for a lower price. We also offer an annual plan where customers can pay in monthly installments for those who cannot make the up-front payment. This annual billed monthly plan comes with a fee that is representative of the difference between the price of our monthly plan and the price of the discounted annual commitment plan, if customers decide to terminate their contract early.
We are committed to transparency with our customers, including in our terms and conditions, and to providing them with a great customer experience. As a pioneer in this space, we are continually listening to feedback to improve our customers’ experience and make changes to our design, processes and policies in response, as we have done repeatedly over the years.
Status of the Case
The FTC has chosen to focus this lawsuit on allegations that our subscription practices are not clear or simple, and yesterday’s complaint places a particular focus on the early termination fee associated with our annual billed monthly plan. We are confident our subscription business practices comply with the law and are clear, simple, and transparent. The early termination fee noted is not a material part of our business, only accounting for less than half a percent of our revenue. Despite it not being a material part of our business, we believe this plan and approach is the best way to offer a significant discount to our customers at the point of purchase in exchange for their one-year commitment to our product.
We are also disappointed that the government pored over tens of thousands of documents that we supplied and ended up with this complaint that both mischaracterizes our business and business decisions, and cherry picks old employee comments from four years ago from a non-executive team member, which they then take out of context.
We have a unique and special opportunity to empower millions of customers around the world to create amazing digital experiences and will continue to innovate and make our customer interactions world-class. We look forward to setting the record straight and winning in court.
The FTC has chosen to focus this lawsuit on allegations that our subscription practices are not clear or simple, and yesterday’s complaint places a particular focus on the early termination fee associated with our annual billed monthly plan. We are confident our subscription business practices comply with the law and are clear, simple, and transparent. The early termination fee noted is not a material part of our business, only accounting for less than half a percent of our revenue. Despite it not being a material part of our business, we believe this plan and approach is the best way to offer a significant discount to our customers at the point of purchase in exchange for their one-year commitment to our product.
We are also disappointed that the government pored over tens of thousands of documents that we supplied and ended up with this complaint that both mischaracterizes our business and business decisions, and cherry picks old employee comments from four years ago from a non-executive team member, which they then take out of context.
We have a unique and special opportunity to empower millions of customers around the world to create amazing digital experiences and will continue to innovate and make our customer interactions world-class. We look forward to setting the record straight and winning in court.
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Adobe’s Recent Statement Regarding Updated Federal Trade Commission Complaint
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2024-07-25
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In June, the FTC filed a lawsuit about Adobe’s subscription business practices. The FTC has now published an updated version of the complaint, unfortunately taking four-year-old conversations and details from employee emails out of context to supplement their claims.
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