Amazon faces FTC trial over Prime sign-up practices
The U.S. Federal Trade Commission (FTC) has opened its case against Amazon, accusing the company of tricking millions of shoppers into signing up for unwanted Prime subscriptions, according to Reuters.
FTC argues that Amazon executives avoided making the sign-up and cancellation process easier to protect their revenue. Government attorney Jonathan Cohen described it as the «more members, more money» principle, claiming that the company prioritized growth over consumer choice.
Prime costs up to $14.99 per month and offers fast shipping and streaming. The FTC contends Amazon enrolled many shoppers without clear information and required them to navigate a complicated cancellation process called the «Iliad flow,» a term reportedly used within Amazon to describe a lengthy and complex cancellation path, referencing the epic journey in Homer’s Iliad. Former Amazon researcher Reid Nelson explained the process as both challenging to initiate and demanding to complete, the news agency wrote.
Amazon denies wrongdoing. Company attorney Moez Kaba said Prime’s terms clearly disclose key points and that customers can cancel easily. He accused the FTC of cherry-picking evidence to portray Amazon as deceptive.
This case could result in significant penalties and serves as a test of the FTC’s efforts to stop what it calls manipulative online practices. Similar lawsuits have targeted Uber and LA Fitness for their practices related to subscription cancellations. The trial is expected to last approximately a month and will feature testimony from customers and Amazon employees.
It is worth noting that this isn’t the first FTC case against Amazon, as the agency has a long history of interaction with the company over this issue, accusing it of deliberately designing the Prime cancellation process to prevent subscribers from canceling their subscriptions. In 2023, the FTC said that «Amazon leadership slowed or rejected changes that would’ve made it easier for users to cancel Prime because those changes adversely affected Amazon’s bottom line.»
