Adobe exec compared Creative Cloud cancellation fees to 'heroin'

Adobe is facing scrutiny from the FTC over its Creative Cloud subscription practices, particularly regarding hidden early termination fees (ETFs) and complicated cancellation processes. An executive's comment likening these fees to "heroin" has drawn attention, suggesting that the company is aware of the negative impact of these practices but feels unable to change them without significant business repercussions. The FTC's complaint alleges that Adobe has not clearly disclosed the ETFs associated with its annual plans billed monthly, which can lead to consumer confusion and dissatisfaction. Adobe's general counsel, Dana Rao, defended the company, stating that the fees represent a small fraction of its revenue and that the company has been working to improve its subscription practices since 2021. Rao emphasized that the cancellation process has been streamlined and that the complexity of displaying ETF amounts is due to the variable nature of the fees based on the timing of cancellation. The FTC's case is complicated by a recent Supreme Court ruling that may allow Adobe to challenge the FTC's interpretation of what constitutes a clear and simple cancellation process. Rao expressed confidence in Adobe's practices compared to other companies, asserting that they aim to provide a user-friendly experience. The outcome of this case could have significant implications for Adobe and its subscription model.