Consumer Rights Wiki - User contributions [en]

Forced app download

2025-10-04T17:20:29Z

Beanow: Add to Theme category

Most of these{{incomplete}}{{ToneWarning}}

'''Forced app download''' is a practice committed by businesses and government entities where users must download an app on their smartphones to perform simple tasks that may have otherwise been possible on a standard web browser<ref>{{Cite journal |last=Tian |first=Deyu |last2=Ma |first2=Yun |last3=Balasubramanian |first3=Aruna |last4=Liu |first4=Yunxin |last5=Gang |first5=Huang |last6=Liu |first6=Xuanzhe |date=17 Mar 2021 |title=Characterizing Embedded Web Browsing in Mobile Apps |url=https://ieeexplore.ieee.org/document/9380491 |journal=IEEE Transactions on Mobile Computing |volume=21 |issue=11 |pages=3912 - 3925 |via=IEEE Xplore}}</ref> (e.g., adding a credit card for payments) or in real life (e.g., ordering a coffee).

Implementation of forced app download is increasing in many countries with the aim of digitization. For example, in Singapore, it is impossible for residents to have a bank account without using the bank's mobile application{{Citation needed}}. Additionally, Singapore residents must also utilize a smartphone that runs an unmodified version of iOS or Android in order to download the mandate apps from their respective app stores{{Citation needed}}.

Because forced app download generally means alternative measures, such as website access, are possible, entities that engage in this practice have little reason to do so outside of personal gain. They may find it favorable for several reasons, including:
#'''Identification and tracking of users''' - often accomplished through device identifiers, location information, and network connection.{{Citation needed}}
#'''Increased digital integration''' - more integrating means more sharing data with payment processors,{{Citation needed}} ad providers,{{Citation needed}} and more.
#'''Increased centralization and dependency on big companies''' - further consolidates power and wealth into large companies such as the tech companies who own the app stores as well as payment processors like Visa and MasterCard{{Citation needed}}

==Characteristics==
Forced app download involves:

#'''Forcing download and use of app to interact with a business''' - Basic tasks like ordering,{{Citation needed}} making payments, changing settings.{{Citation needed}}
#'''Deliberately crippling or removing functionality from the web experience''' - Prevent users from having an alternative interface to perform basic tasks.{{Citation needed}}
#'''Forcing users to always be on the latest version of an app''' - "For your security" (as they usually claim), most of these apps will constantly check for the latest version and self-disable if they are older than x-version.{{Citation needed}} (varies by company)
#'''Mandatory use of account''' - For most of these apps to work, you must have an account for features to work.{{Citation needed}} For example, making an order with Luckin Coffee mandates installing the app and creating an account tied to a personal phone number;{{Citation needed}} guests are disallowed from making orders incognito.{{Citation needed}}

==Key implications==

===User tracking and intrusion of privacy===
The hallmarks of forced app download are mandatory account creation and usage, and digital payments. This allows tracking of the user not just by the company behind the app, but the payment provider and any other associated third-party partners.

===Mandatory use of "approved devices" and big-tech operating systems===
Most apps are only available for download on official from official app stores, meaning consumers must use a device running stock iOS or Android, or else jump through hoops to run them.<ref>{{Cite web |title=Run Android apps on Arch Linux |url=https://wiki.archlinux.org/title/Android#Run_Android_apps_on_Arch_Linux |url-status=live |access-date=3 Apr 2025 |website=archlinux.org}}</ref><ref>{{Cite web |title=How do I get an apk file from an Android device? |url=https://stackoverflow.com/questions/4032960/how-do-i-get-an-apk-file-from-an-android-device/18003462#18003462 |url-status=live |access-date=3 Apr 2025 |website=Stack Overflow}}</ref>

Devices must also be running stock operating systems since most government and business apps conduct intrusive checks<ref>{{Cite web |title=Configure API responses (optional) |url=https://developer.android.com/google/play/integrity/setup#default |url-status=live |access-date=3 Apr 2025 |website=Android Developers}}</ref> and will not run if a device is jail-broken or rooted.

Some companies such as big banks in Singapore have also started incorporating checks for "unverified apps" in their app. This means their app will scan your phone and check for sideloaded apps (anywhere that is not the official app store. For example, an app downloaded directly from APK Mirror or an unofficial app repository like F-Droid) as part of "anti-scam security measures that include restricting customers from accessing the banks’ digital services on their mobile phones if apps from unverified app stores – also known as [[Sideloading|sideloaded apps]] – are detected."<ref>{{Cite web |last=See Kit |first=Tang |date=26 Sep 2023 |title=DBS, UOB become latest banks to restrict access if unverified apps are found on customers' phones |url=https://www.channelnewsasia.com/singapore/dbs-uob-anti-scam-sideloaded-app-malware-measure-latest-bank-restrict-app-access-3796806 |url-status=live |access-date=3 Apr 2025 |website=Channel News Asia}}</ref>

===Surge pricing===
{{Main|Surge Pricing}}
So far, the implementation of surge pricing in the context of businesses that use forced app download has not yet been seen. However, trust that the enterprising individuals and eCommerce platform providers (especially "modern headless eCommerce" companies<ref>{{Cite web |last=Cicman |first=Joe |last2=Pfeiffer |first2=Emily |date=3 May 2022 |title=Doing, Selling, And Being Headless Commerce |url=https://www.forrester.com/blogs/doing-selling-and-being-headless-commerce/ |url-status=live |access-date=3 Apr 2025 |website=Forrester}}</ref>) looking to maximize clean out of consumers' wallets will quickly develop and deploy surge pricing once businesses with forced app download gain sufficient footing both in their respective industries and in general market penetration.

Since ordering and payments are entirely digital, it is very possible to see surge pricing (similar to what we've seen from ride hailing companies like Uber, Lyft and Grab) implemented across other industries.

For example, a restaurant with enough popularity could implement surge pricing to increase prices during peak hours, such as lunch time on weekdays to impact the downtime office crowd that is lacking in time and places to eat, or nighttime hours on weekends when people are looking to go out.

===Third-party integration===
Similar to how some car insurance providers in the U.S. are adjusting their rates based on "smart reporting" from cars, it is also very possible for other intrusive and oppressive pair ups to happen. For example:

*Restaurants, cafes and bars with forced app download sharing data with health insurance companies, who increase your premium if they see a lifestyle/pattern of ordering unhealthy dishes or overly large portions, or frequenting that bubble tea shop too often.
*Government tax agency charging you "excess carbon footprint" taxes because you often order a lot of clothes beyond the number that the "Average" person of your profile wears, based on what your favorite fast fashion retailer with forced app download is sharing with them.

===Discrimination===
Those who can not or do not have the required technology are further disadvantaged. Not everybody can afford a smart phone. Not everybody can operate one, differences in visual ability, physical ability, mental ability (e.g., dementia) can make smart phones unusable. Visitors, tourists, and those who have had a device lost, stolen or broken lose out. If banking requires an app, and your phone breaks, how do you get the money to buy a replacement?

===Decreased security===
If many people are using an app for valuable transactions, the app may become a target for malware. (Create fake versions of the app, exploit weaknesses in the app, etc.)

===Increased vulnerability in adverse circumstances===
It may become harder to function in emergency situations. If network connections are unavailable, or power is out for an extended period, how do you get necessities?

When errors are found in the app you may lose access to important services. With a web browser, you have alternatives. What are the alternative to the app?

In domestic violence, control of devices can be one of the ways to control a person. If a device is needed to access the bank, then whoever controls that device may control the money. Even if the victim gets physical possession of a device, the other party may be able to remotely manipulate it.[[File:Digital turbine logo .png|alt=digital turbine logo |thumb|digital turbine logo ]]
[[File:No unverified apps.png|thumb|Singapore banks will "restrict access if unverified apps AKA sideloaded apps are found on customers' phones" (News story from Sep 2023)]]

==Examples==
'''Mobile Carriers and App marketplaces'''

Companies like [[digital turbine|Digital Turbine]] auction<ref>{{Cite web |title=DT Fairbid |url=https://www.digitalturbine.com/dt-fairbid |url-status=live |access-date=3 Apr 2023 |website=Digital Turbine}}</ref> off placement in carriers automatic download lists and recommended app's placement in first and third party app stores.<ref>{{Cite web |title=Turn Subscribers Into Fans |url=https://www.digitalturbine.com/telecom |url-status=live |access-date=3 Apr 2025 |website=Digital Turbine}}</ref>

Digital turbine sells forced app downloads from app developers like: [[zynga]], Miniclip games, [[King Digital Entertainment|'''King''' Digital Entertainment]] and [[Uber EULA precludes jury trial|Uber]], placement in forced download lists to carries like: [[Verizon]], [[AT&T]], [[Cricket wireless]], US cellular, Tracfone and T-mobile.<ref>{{Cite web |title=A New Horizon for Apps is Emerging |url=https://www.digitalturbine.com/ |url-status=live |access-date=3 Apr 2025 |website=Digital Turbine}}</ref>

===Banking and finance===
All banks in Singapore (Citi, DBS, UOB, OCBC, Standard Chartered, CIMB) mandate use of their apps for consumers to perform any online banking activities, including logging in via their web browser.
[[File:Forced app download.png|thumb|Luckin Coffee, a China-origin Starbucks competitor, forces you to download their app to order and pay for coffee. You cannot order coffee at the cashier in their store, let alone pay. You must use the app to interact with this business and digital payments to pay.]]
[[File:Forced app download - Citibank Singapore.png|thumb|Citibank Singapore has deliberately disabled many basic functions such as rewards redemption on its website since 2024, forcing users to download and use their mobile app as an "alternative".]]
The apps generate notifications that require users to approve/deny actions like logging in via a web browser, initiating a payment, adding a payee, etc via the app itself. Some banks previously offered sending an OTP via SMS (text) as an alternative to app-based approval but this has since been discontinued for "security reasons".

==='''Insurance'''===
Auto insurance companies like [[Progressive]], require non policy holders effected by automotive incidents their policyholders claim to submit photos and video evidence of damages exclusively through their mobile app.<ref name=":0">{{Cite web |title=Auto insurance claims |url=https://www.progressive.com/claims/auto-process/ |url-status=live |access-date=3 Apr 2025 |website=[[Progressive]]}}</ref> Affected non-policy holders can't complete the entire claim process through their website even though you can start the process online from any device and web browser.<ref name=":0" />

===Utilities and public services===
SP Group is Singapore's primary and default electricity provider, as well as the country's only provider for gas and water for consumers. In 2022, SP Group removed the ability to manage payments from their website, forcing users to download and use their mobile app to pay bills/manage recurring payments.<ref>{{Cite web |title=Pay SP utility bills with SP app |url=https://www.spdigital.sg/spapp/bill-payment |url-status=live |access-date=3 Apr 2025 |website=SPdigital}}</ref>

As they are the country's sole gas and water provider, residents will effectively be forced to download SP Group's app eventually.

===Home appliances and hardware===
Speaker and sound hardware company [[Sonos]] has been a big practitioner of forced app download since at least 2017.<ref>{{Cite web |title=Make Sonos work without internet |url=https://en.community.sonos.com/advanced-setups-229000/make-sonos-work-without-internet-6795315 |url-status=live |access-date=3 Apr 2025 |website=[[Sonos]]}}</ref> Sonos makes it unnecessarily difficult, if not impossible for their customers to use their hardware without an app and/or internet connection.

Even though it is possible to use Sonos speakers without an app, initial setup has required the download and use of Sonos' app since at least May 2022.

"Yes you can (use the Sonos Roam speaker without an app). However, you will need to set it up for the first time using the app." (May 2022)<ref>{{Cite web |title=Can I Use a Roam Without the App? |url=https://en.community.sonos.com/portable-speakers-229130/can-i-use-a-roam-without-the-app-6869207 |url-status=live |access-date=3 Apr 2025 |website=[[Sonos]]}}</ref>

In addition, not all Sonos products support use without an app (April 2023)<ref>{{Cite web |last=Smith |first=Andrew |date=22 Apr 2023 |title=How To Use Sonos Without The App: A Complete Guide |url=https://soundscapehq.com/how-to-use-sonos-without-app/ |url-status=live |access-date=3 Apr 2025 |website=Sound Scape HQ}}</ref> and even if they do, sans-app usability is only limited to one speaker.

"You can use speakers without an app, but it only applies to a single speaker. If you want to play audio across multiple speakers, you will have to use the app and there is no other workaround to this." (Dec 2021)<ref>{{Cite web |last=Bearson |first=Rune |date=14 December 2021 |title=Can You Use Sonos Speakers Without the App? |url=https://earrockers.com/can-you-use-sonos-speakers-without-the-app/ |url-status=live |access-date=3 Apr 2025 |website=Ear Rockers}}</ref>

==='''Hobbyist tools'''===
3D Printer manufacturer [[Bambu Lab]] forces users to bind their machines to an account via the use of an app called Bambu Handy and also forces the user to connect the machine to the internet whether they want to use LAN only mode or not. The fallout of this is that if you reset a machine and the servers are shut down the machine is a brick. [https://wiki.bambulab.com/en/x1/manual/setup-for-first-print]

===Retail and ecommerce===
Ecommerce giant [[Shopee]], which has a stronghold in online retail in South East Asia and Latin America, has integrated a soft forced app download to their customer experience.

While it is still possible to browse, shop and checkout on a web browser, coupons usable on the web experience (regardless if mobile or desktop device) are limited to "Shipping Discount" coupons only. All other shopping coupons "Discount & Cashback" are only usable with Shopee's apps on iOS and Android.

When a customer attempts to check out on a web browser, Shopee shows that Discount & Cashback coupons are not usable because "Current device does not meet voucher T&C". On closer inspection of the terms and conditions of those coupons, Shopee specifies "Device: iOS, Android". What they are referring to is you must download and use their mobile apps for those operating systems in order to use most of their coupons. As pictured, the coupons are still not available on iOS and Android devices if the customer is using their web browser, thus effectively forcing customers to download the Shopee app.
[[File:Shopee restricts coupon usage to app only.png|thumb|'''LEFT:''' Shopee limits customers to using "Shipping Discount" coupons only if checking out on a web browser (desktop and mobile). '''MIDDLE:''' All other shopping coupons "Discount & Cashback" are only usable with Shopee's apps on iOS and Android.

'''RIGHT:''' Closer inspection of the terms and conditions where Shopee specifies a device requirement for using many of their coupons.

When Shopee specifies "Device: iOS, Android", they mean customers must download and use their mobile apps for those operating systems in order to use most of their coupons. Using a web browser on iOS and Android does not count and coupons in question remain disabled in this scenario.]]
[[File:Shopee coupon still unusable on mobile web.jpg|thumb|Using a web browser on iOS and Android does not count and coupons with the device requirement remain disabled. What Shopee means by "Device: iOS, Android" in their coupons' terms and conditions is that customers are required to download and use the Shopee app for coupons to be redeemable.]]

===Food and beverage===
An increasing number of 'digital-native' food businesses that are app-only are making their way onto the market. For example, Luckin Coffee, a Starbucks competitor from China, with stores in Singapore and planned expansion into Malaysia and the US in 2025,<ref>{{Cite web |date=29 Oct 2024 |title=China’s Luckin Coffee reportedly planning US launch in 2025 |url=https://www.worldcoffeeportal.com/Latest/News/2024/October/China-s-Luckin-Coffee-reportedly-planning-US-launc |url-status=live |access-date=3 Apr 2025 |website=World Coffee Portal}}</ref> only allows ordering of beverages and payments via its app. The way it works is you download the app, register an account, log in, order a coffee and pay for it, then pick it up at a Luckin Coffee location. "With Luckin, you do not order coffee over the counter like in regular Western coffee shops. Instead, you do everything online. I ordered my drinks here without even needing to talk to the Barista!"<ref>{{Cite web |date=22 Jan 2024 |title=I Taste Tested 3 Signature Luckin Coffee Drinks, Photos (Creamy Dreamy, Big Cheesy, Coconut Latte) |url=https://www.clearlycoffee.com/review-signature-luckin-coffee-drinks-photos-creamy-dreamy-big-cheesy-coconut-latte/ |url-status=live |access-date=3 Apr 2025 |website=Clearly Coffee}}</ref>

With a food-and-beverage business that is fully committed to forced app downloads like Luckin Coffee, there is no way to order nor pay at the physical store. You must download and use the app to interact with the business.

Forced app download represents the next stage of evolution from QR code based ordering. The key differences are:
{| class="wikitable"
|+
!Characteristic
!Forced app download
!QR-code based
|-
|Interface
|App downloaded from official app store
|Page opened in your choice of web browser
|-
|Ordering
|Order must be placed via app
|QR is pushed but usually possible to order offline (in real life)
|-
|Login
|You must create an account and log in to place an order
|Not required, often no registration is possible
|-
|Payments
|Cashless digital payment only
Payment must be made via app
|Depending on website, sometimes order online, pay offline
Depending on business, cash payments are usually possible
|}

==References==
[[Category:Anti-Consumer_Practices]]
[[Category:Common terms]]
[[Category:Theme]]
<references />

Consent-or-pay

2025-10-04T17:17:59Z

Beanow: Add to Theme category

'''Consent-or-pay''', also known as '''consent-or-okay''', is a business model implemented in response to the European Union's ''[[General Data Protection Regulation]]'' [[General Data Protection Regulation|(GDPR)]]. Under this model, users of a website are presented with a choice to either:

*'''Consent''' to the use of cookies and personal data for targeted advertising, '''or'''
*'''Pay''' a small monthly fee to access the service without tracking.

The practice has been the subject of discussion among regulators, policymakers, and consumer advocates, with many viewing the practice as undermining the principle of meaningful consent within the General Data Protection Regulation. Consent-or-pay has been adopted by a number of large online platforms and news organizations. As of August 2025, 16 of the 50 largest UK news websites had implemented a consent-or-pay model.<ref name="Press Gazette">{{Cite web |first=Charlotte |last=Tobitt |title=Press Gazette, More UK news publishers are adopting 'consent or pay' advertising model |url=https://pressgazette.co.uk/marketing/consent-or-pay-uk-publishers-advertising-2025/ |url-access=limited |date=21 Aug 2025 |access-date=1 Sep 2025 |url-status=live |archive-url=https://web.archive.org/web/20250821204423/https://pressgazette.co.uk/marketing/consent-or-pay-uk-publishers-advertising-2025/ |archive-date=21 Aug 2025}}</ref>

==Background==
{{Main|General Data Protection Regulation}}

The General Data Protection Regulation was enacted in 2018 with the objective of protecting online users from extensive data collection by companies. The regulation requires companies to obtain user consent for data collection, which is typically facilitated through an opt-in banner or pop-up on a website.

Some companies reported a negative impact on revenue following the regulation's implementation<ref name=":2">{{Cite web |last=Mititelu |first=Andra |date=2023 |title=As the Open Marketplace Fails, Advertisers Are Turning to Publishers to Reach Audiences |url=https://advertisingweek.com/as-the-open-marketplace-fails-advertisers-are-turning-to-publishers-to-reach-audiences/ |url-status=live |archive-url=https://web.archive.org/web/20230927212627/https://advertisingweek.com/as-the-open-marketplace-fails-advertisers-are-turning-to-publishers-to-reach-audiences/ |archive-date=27 Sep 2023 |access-date=1 Sep 2025 |website=Advertising Week}}</ref>, as the scale of data collection for targeted advertising was reduced. The consent-or-pay model emerged as an approach to address this change.

==How it works==
When a user visits a website, a pop-up consent window is displayed. While traditional options were to '''Accept''' or '''Reject''' cookies, the consent-or-pay model presents users with the options to '''Accept or Pay'''.

*The payment is typically a monthly fee (e.g. £1.99 per month).
*Many sites employing this model were previously free-to-access and funded primarily through advertising.
*Users must now either pay with their personal data or with a monetary fee.

This effectively introduces a paywall for content that is considered freely available, even in the absence of a traditional subscription model.

==Why it is a problem==

===Invalid consent===
This binary choice model raises questions about the validity of consent as users are required to choose between two options, both of which involve a form of payment for content that is considered free.

===Lack of informed consent===
Companies typically state that cookies and data collection are for "personalized ads" and "improving services." The extent to which user data is stored, shared with third-parties, sold to data brokers, or potentially exposed in data breaches is often not detailed. This may lead to users underestimating the long-term implications of sharing their personal data.

===False equivalence===
The consent-or-pay model equates the value of a user's data to a specific monetary amount. The methodology for calculating this equivalent monthly fee comes into question as it is difficult to ascertain the precise advertising revenue generated from an individual user. The fee is often based on an average revenue per user (ARPU) metric, which applies a generalized value to all users regardless of their individual engagement with advertisements and despite studies suggesting that data cannot be fairly valued<ref>{{Cite web |last=Fleckenstein |first=Mike |date=26 Jan 2023 |title=A Review of Data Valuation Approaches and Building and Scoring a Data Valuation Model |url=https://hdsr.mitpress.mit.edu/pub/1qxkrnig/release/1 |website=HDSR. MIT Press}}</ref><ref>{{Cite web |last=Diehl |first=Hannah |date=14 Jun 2025 |title=Semivalue-based data valuation is arbitrary and gameable |url=https://arxiv.org/abs/2506.12619 |url-status=live |archive-url=https://arxiv.org/abs/2506.12619 |website=Cornell University}}</ref><ref>{{Cite web |date=27 Jun 2025 |title=Why ARPU Lies: The Danger of Averages in Pricing Analytics |url=https://www.getmonetizely.com/articles/why-arpu-lies-the-danger-of-averages-in-pricing-analytics |website=Monetizely}}</ref>.

===Illusion of a fair exchange===
The model can create a perception that a fair exchange is taking place. By offering a seemingly low monthly fee as an alternative to data collection, users may believe they are compensating the company fairly for lost advertising revenue. This can influence the decision-making process regarding data privacy.

==Meta investigation and fine==
Following an investigation by the European Commission, [[Meta]] was fined on 23 April 2025 for non-compliance with the [[Digital Markets Act]] (DMA). The investigation concluded that Meta's consent-or-pay model did not meet the DMA's requirements for reducing personalized data for targeted ads and did not allow for freely given consent.<ref>{{Cite web |date=30 Jun 2024 |title=Commission sends preliminary findings to Meta over its "Pay or Consent" model for breach of the Digital Markets Act |url=https://ec.europa.eu/commission/presscorner/detail/en/ip_24_3582 |website=European Commission}}</ref> Meta was fined €228 million in April, and by July, the European Commission warned that the company could face additional daily fines if it continued to employ this model.<ref>{{Cite web |author=Foo Yun Chee |title=Meta may face daily fines over pay-or-consent model, EU warns |url=https://www.reuters.com/sustainability/boards-policy-regulation/meta-will-only-make-limited-changes-pay-or-consent-model-eu-says-2025-06-27/ |date=27 Jun 2025 |access-date=1 Sep 2025 |website=Reuters |url-status=live |archive-url=https://archive.is/WlLFg |archive-date=1 Sep 2025}}</ref>

==Uses==

===News organizations===
Several media outlets in Europe have adopted consent-or-pay models, including:

*The Mirror
*The Independent
*Der Spiegel
*Der Standard
*Le Monde
*Le Parisien
*Corriere della Sera
*MeridioNews<gallery mode="slideshow">
File:Screenshot 20250910-195708 IronFox.png|alt=Screenshot of MeridioNews' consent-or-pay policy viewed on a mobile browser. (written in Italian)|Screenshot of MeridioNews' consent-or-pay policy appearing after rejecting cookies on [https://meridionews.it/piazzale-anita-garibaldi-ennesimo-raid-dei-vandali-la-provocazione-di-artale-mettiamo-una-garitta/ one of their articles]
File:08cd9c3c-fd76-4cc0-bf9a-0e85d8133609.png|alt=(machine-translated from Italian) screenshot of MeridioNews' consent-or-pay policy appearing after rejecting cookies on one of their articles, viewed from a mobile device|(machine-translated) screenshot of MeridioNews' consent-or-pay policy
</gallery>
==Critical response==

===Regulatory agencies===
In 2024, the European Data Protection Board (EDPB) published a non-binding opinion on "Valid Consent in the Context of Consent or Pay Models Implemented by Large Online Platforms." The opinion stated that the consent-or-pay model does not constitute valid consent and that appropriate alternative measures should provide users with an "equivalent alternative." Furthermore, it noted that if a payment model is offered, the alternative should not involve processing personal data. Choices in which users feel compelled to consent does not qualify as valid consent.<ref name=":0">{{Cite web |date=17 Apr 2024 |title=EDPB: 'Consent or Pay' models should offer real choice |url=https://www.edpb.europa.eu/news/news/2024/edpb-consent-or-pay-models-should-offer-real-choice_en |url-status=dead |archive-url=https://web.archive.org/web/20250711204531/https://www.edpb.europa.eu/news/news/2024/edpb-consent-or-pay-models-should-offer-real-choice_en |archive-date=11 Jul 2025 |access-date=1 Sep 2025 |website=European Data Protection Board}}</ref>

Anu Talus, Chair of the EDPB, said:<blockquote>"Online platforms should give users a real choice when employing 'consent or pay' models. The models we have today usually require individuals to either give away all their data or to pay. As a result most users consent to the processing in order to use a service, and they do not understand the full implications of their choices."<ref name=":0" /></blockquote>

===Consumer advocacy groups===
"[[NOYB|noyb]]" is a data protection advocacy organization based in Austria that focuses primarily on compliance and violations of the General Data Protection Regulation<ref>{{Cite web |title=About Us |url=https://noyb.eu/en/about-us |website=noyb}}</ref>. In November 2023, the group filed a complaint with the Austrian Data Protection Authority against Meta, arguing that the company lacked "any valid legal basis for [pay-or-okay]. [...] Meta is now trying to extort supposed consent from its users with a 'yes or pay' choice".<ref>{{Cite web |date=28 Nov 2023 |title=COMPLAINT UNDER ARTICLE 77(1) GDPR |url=https://noyb.eu/sites/default/files/2023-11/Complaint%20-%20Meta%20Pay%20or%20Okay%20-%20REDACTED.pdf |website=noyb - European Centre for Digital Rights}}</ref> The complaint cited the high costs of rejecting personalized ads, which was €12.99 per month for [[Facebook]] and €8 per month for [[Instagram]], approximating a combined annual cost of €251.88.<ref name=":1">{{Cite web |date=28 Nov 2023 |title=noyb files GDPR complaint against Meta over "Pay or Okay" |url=https://noyb.eu/en/noyb-files-gdpr-complaint-against-meta-over-pay-or-okay |website=noyb}}</ref> ''noyb'' expressed concern that Meta's approach could set a precedent for other platforms, potentially leading to €35,000 per family when combined with other platforms and websites<ref name=":1" />.

==Effectiveness==
''The Open Marketplace'', once considered the easiest and most efficient platform for advertisers and publishers to transact, has been facing steady decline since the General Data Protection went into effect<ref name=":2" />. In a report by Advertising Week published in September 2023, advertisers using Open Marketplace were reaching only roughly 30% of their audience, meaning that 70% of advertising efforts were wasted due to users opting out of data collection<ref name=":2" />. Their findings were based upon a report from ''Nano Interactive,'' a company that claims to be "at the forefront of privacy-first, identity-free online advertising"<ref>{{Cite web |title=Who We Are |url=https://www.nanointeractive.com/company/ |website=Nano Interactive}}</ref>, in which the company surveyed 2,000 UK consumers and found that 70% of them rejected cookies using various methods (VPN, incognito mode, clearing cache, etc)<ref name=":3">{{Cite web |title=UK Cookie-Blocking Research |url=https://www.nanointeractive.com/tipping-point-research/ |website=Nano Interactive}}</ref><ref name=":4">{{Cite web |last=O'Connell |first=Vanessa |date=9 May 2023 |title=70% of consumers blocking cookies online, research shows |url=https://www.thedrum.com/opinion/2023/05/09/70-consumers-blocking-cookies-online-research-shows |url-status=live |archive-url=https://web.archive.org/web/20230511090722/https://www.thedrum.com/opinion/2023/05/09/70-consumers-blocking-cookies-online-research-shows |archive-date=11 May 2023 |access-date=1 Sep 2025 |website=The Drum}}</ref>.

''The Drum'' reported on that same survey by noting the increasing discomfort consumers have on trading personal data for free content<ref name=":4" />. Those in the survey were split 30-30% on whether they view this as a fair exchange, but over half believe advertisers should find better ways to make ads relevant. Additionally, it was reported that of consumers who are concerned about privacy, 42% report data collection as their biggest concern, while only 31% are concerned with data breaches or online scams respectively<ref name=":3" /><ref name=":4" />.

==Alternative practices==
'''Contextual advertising''' is a model that serves ads based on the content of the page a user is viewing (e.g., food ingredients on a recipe page). This advertising model had once been considered the standard on the internet and has returned in high numbers since the General Data Protection Regulation went into effect<ref name=":5">{{Cite web |last=Davies |first=Jessica |date=7 Jun 2018 |title=‘Personalization diminished’: In the GDPR era, contextual targeting is making a comeback |url=https://digiday.com/media/personalization-diminished-gdpr-era-contextual-targeting-making-comeback/ |website=Digiday}}</ref><ref name=":6">{{Cite web |last=Maher |first=Bron |date=21 Nov 2023 |title=Guardian gets around readers who reject cookies with new advertising product |url=https://pressgazette.co.uk/marketing/guardian-light-reject-cookies-advertising-stereotype/ |url-access=limited |url-status=live |archive-url=https://web.archive.org/web/20231128184011/https://pressgazette.co.uk/marketing/guardian-light-reject-cookies-advertising-stereotype/ |archive-date=28 Nov 2023 |access-date=1 Sep 2025 |website=Press Gazette}}<nowiki>}}</nowiki></ref>. ''The Guardian'', a UK-based news organization, reported a 35% increase in ad clicks after emplying this model, describing it as "a perfect advertising product for a privacy conscious brand"<ref name=":6" />. An article from ''Digiday'' reports that some publishers had long complained at the loss of contextual advertising in the rush to micro-target through personalized ads<ref name=":5" />. They state the the infamous ''ad-pocalypse'' from YouTube could have been avoided if advertisers stuck with contextual advertising instead of following users around the internet<ref name=":6" />.

==See also==
[[Europe-based news sites enact consent-or-pay for data tracking]]

[https://noyb.eu/en/years-inactivity-pay-or-ok-cases-noyb-sues-german-dpas Years of inactivity in “Pay or OK” cases: noyb sues German DPAs]

[https://noyb.eu/en/noybs-pay-or-okay-report-how-companies-make-you-pay-privacy noyb's Pay or Okay report: how companies make you pay for privacy]

[https://digiday.com/media/personalization-diminished-gdpr-era-contextual-targeting-making-comeback/ ‘Personalization diminished’: In the GDPR era, contextual targeting is making a comeback]

==References==
{{Reflist}}

[[Category:Common terms]]
[[Category:Theme]]

Disabling online features in retaliation

2025-10-04T17:13:26Z

Beanow: Style and grammar nit

{{StubNotice}}

'''Disabling online features in retaliation''' is a practice in which businesses deny access to online functionality because the user of a product did not adhere to terms / policies unrelated to the online service. Making the product less useful and less valuable.

==How it works==

Business may use this practice in a situation where the product '''has online features''' that most customers would find valuable, the customer '''cannot chose the provider''' for this online service (usually by the same manufacturer as the device) and the business has an anti-competitive reason to enforce restrictions on the product that are technologically difficult to enforce directly.

The product will use some kind of detection mechanism to determine if the customer breaks one of the manufacturers terms and '''in retaliation''' disables the online features the customer cared about.
As a result the product has decreased utility and (resale) value, harming the customer.

==Why it is a problem==

'''Manufacturer directly inflicts harm'''

The manufacturer has the ability to inflict immediate and direct harm by reducing the utility and value of the product whenever the manufacturer sees fit, based on terms that the manufacturer imposed. Even if the customer has any recourse available, the manufacturer can decide to keep online features disabled during the dispute.

'''Chilling effect'''

Customers may refrain from using their product in otherwise legal ways, due to fear of the manufacturer retaliating.

'''Anti-competitive'''

Business may use this tactic to force the consumer to buy only first party accessories / replacement parts. Regardless of whether the third party products can be legally put on the market, the manufacturer can still threaten the customer with an online ban. This stifles competition in the product's after-market.

'''Lack of recourse'''

Because the online services can't be easily replaced with an alternative provider. Customers don't have a good option to contest a decision or compel the manufacturer to provide them online services, besides taking them to court. The manufacturer may also claim there are no product defects, so warranty claims or refunds for the product may be denied. Especially when combined with [[forced arbitration]] clauses, this can make it infeasible for an individual customer to fix or recover the harm inflicted on them.

'''Perverse incentive to add online features'''

Manufacturers may design their products with an unnecessary reliance on online features to use it as an enforcement mechanism, rather than adding value to the product.

[[File:Bricked Switch 2.png|thumb|A screenshot from a [https://www.youtube.com/watch?v=ExgYTA18_vo&t=656s video by Scattered Brain], displaying his Switch 2 console being bricked]]

==Examples==

Some examples of disabling online features in retaliation include:

*[[Nintendo Switch 2]] consoles disabling [[Nintendo Switch Online]] functionality when MIG Switch cartridges are detected.<ref name=":3">{{Cite web |last=Scattered Brain |date=Jun 16, 2025 |title=Soo... Nintendo banned my Switch 2 (Don't try the MIG Switch!) |url=https://www.youtube.com/watch?v=ExgYTA18_vo&t=656s |access-date=Jun 18, 2025 |website=[[YouTube]]}}</ref>
*[[Molekule Air Purifier|Molekule Air Purifiers]] disabling Molekule Services (required for using the Molekule app) when 3rd party replacement filters are detected.<ref>{{Cite web |last=Louis |first=Rossmann |date=2025-10-04 |title=YouTube: Air filters have DRM now 🤦‍♂️ |url=https://www.youtube.com/watch?v=LCu_n2Nddu0 |website=YouTube}}</ref>

==References==

{{reflist}}

[[Category:Common terms]]
[[Category:Theme]]

Disabling online features in retaliation

2025-10-04T17:09:31Z

Beanow: Expand on the problem

{{StubNotice}}

'''Disabling online features in retaliation''' is a practice in which businesses deny access to online functionality because the user of a product did not adhere to terms / policies unrelated to the online service. Making the product less useful and less valuable.

==How it works==
Business may use this practice in a situation where the product '''has online features''' that most customers would find valuable, the customer '''cannot chose the provider''' for this online service (usually by the same manufacturer as the device) and the business has an anti-competitive reason to enforce restrictions on the product that are technologically difficult to enforce directly.

The product will use some kind of detection mechanism to determine if the customer breaks one of the manufacturers terms and '''in retaliation''' disable the online features the customer cared about.

As a result the product has decreased utility and (resale) value, harming the customer.

==Why it is a problem==

'''Manufacturer directly inflicts harm'''

The manufacturer has the ability to inflict immediate and direct harm by reducing the utility and value of the product whenever the manufacturer sees fit, based on terms that the manufacturer imposed. Even if the customer has any recourse available, the manufacturer can decide to keep online features disabled during the dispute.

'''Chilling effect'''

Customers may refrain from using their product in otherwise legal ways, due to fear of the manufacturer retaliating.

'''Anti-competitive'''

Business may use this tactic to force the consumer to buy only first party accessories / replacement parts. Regardless of whether the third party products can be legally put on the market, the manufacturer can still threaten the customer with an online ban. This stifles competition in the product's after-market.

'''Lack of recourse'''

Because the online services can't be easily replaced with an alternative provider. Customers don't have a good option to contest a decision or compel the manufacturer to provide them online services, besides taking them to court. The manufacturer may also claim there are no product defects, so warranty claims or refunds for the product may be denied. Especially when combined with [[forced arbitration]] clauses, this can make it infeasible for an individual customer to fix or recover the harm inflicted on them.

'''Perverse incentive to add online features'''

Manufacturers may design their products with an unnecessary reliance on online features to use it as an enforcement mechanism, rather than adding value to the product.

[[File:Bricked Switch 2.png|thumb|A screenshot from a [https://www.youtube.com/watch?v=ExgYTA18_vo&t=656s video by Scattered Brain], displaying his Switch 2 console being bricked]]

==Examples==
Some examples of disabling online features in retaliation include:

*[[Nintendo Switch 2]] consoles disabling [[Nintendo Switch Online]] functionality when MIG Switch cartridges are detected.<ref name=":3">{{Cite web |last=Scattered Brain |date=Jun 16, 2025 |title=Soo... Nintendo banned my Switch 2 (Don't try the MIG Switch!) |url=https://www.youtube.com/watch?v=ExgYTA18_vo&t=656s |access-date=Jun 18, 2025 |website=[[YouTube]]}}</ref>
*[[Molekule Air Purifier|Molekule Air Purifiers]] disabling Molekule Services (required for using the Molekule app) when 3rd party replacement filters are detected.<ref>{{Cite web |last=Louis |first=Rossmann |date=2025-10-04 |title=YouTube: Air filters have DRM now 🤦‍♂️ |url=https://www.youtube.com/watch?v=LCu_n2Nddu0 |website=YouTube}}</ref>

==References==
{{reflist}}

[[Category:Common terms]]
[[Category:Theme]]

Disabling online features in retaliation

2025-10-04T16:45:07Z

Beanow: Markup issues

{{StubNotice}}

'''Disabling online features in retaliation''' is a practice in which businesses deny access to online functionality because the user of a product did not adhere to terms / policies unrelated to the online service. Making the product less useful and less valuable.

==How it works==
Business may use this practice in a situation where the product '''has online features''' that most customers would find valuable, the customer '''cannot chose the provider''' for this online service (usually by the same manufacturer as the device) and the business has an anti-competitive reason to enforce restrictions on the product that are technologically difficult to enforce directly.

The product will use some kind of detection mechanism to determine if the customer breaks one of the manufacturers terms and '''in retaliation''' disable the online features the customer cared about.

As a result the product has decreased utility and (resale) value, harming the customer.

==Why it is a problem==

'''Manufacturer directly inflicts harm'''

The manufacturer has the ability to inflict immediate and direct harm by reducing the utility and value of the product whenever the manufacturer sees fit, based on terms that the manufacturer imposed.
Even if the customer has any recourse available, the manufacturer can decide to keep online features disabled during the dispute.

'''Chilling effect'''

Customers may refrain from using their product in otherwise legal ways, due to fear of the manufacturer retaliating.

'''Anti-competitive'''

Business may use this tactic to force the consumer to buy only first party accessories / replacement parts. Regardless of whether the third party products can be legally put on the market, the manufacturer can still threaten the customer with an online ban. This stifles competition in the product's after-market.

'''Perverse incentive to add online features'''

Manufacturers may design their products with an unnecessary reliance on online features to use it as an enforcement mechanism, rather than adding value to the product.

[[File:Bricked Switch 2.png|thumb|A screenshot from a [https://www.youtube.com/watch?v=ExgYTA18_vo&t=656s video by Scattered Brain], displaying his Switch 2 console being bricked]]

==Examples==
Some examples of disabling online features in retaliation include:

*[[Nintendo Switch 2]] consoles disabling [[Nintendo Switch Online]] functionality when MIG Switch cartridges are detected.<ref name=":3">{{Cite web |last=Scattered Brain |date=Jun 16, 2025 |title=Soo... Nintendo banned my Switch 2 (Don't try the MIG Switch!) |url=https://www.youtube.com/watch?v=ExgYTA18_vo&t=656s |access-date=Jun 18, 2025 |website=[[YouTube]]}}</ref>
*[[Molekule Air Purifier|Molekule Air Purifiers]] disabling Molekule Services (required for using the Molekule app) when 3rd party replacement filters are detected.<ref>{{Cite web |last=Louis |first=Rossmann |date=2025-10-04 |title=YouTube: Air filters have DRM now 🤦‍♂️ |url=https://www.youtube.com/watch?v=LCu_n2Nddu0 |website=YouTube}}</ref>

==References==
{{reflist}}

[[Category:Common terms]]
[[Category:Theme]]

Disabling online features in retaliation

2025-10-04T16:42:47Z

Beanow: Add why this is a problem

{{StubNotice}}

'''Disabling online features in retaliation''' is a practice in which businesses deny access to online functionality because the user of a product did not adhere to terms / policies unrelated to the online service. Making the product less useful and less valuable.

==How it works==
Business may use this practice in a situation where the product '''has online features''' that most customers would find valuable, the customer '''cannot chose the provider''' for this online service (usually by the same manufacturer as the device) and the business has an anti-competitive reason to enforce restrictions on the product that are technologically difficult to enforce directly.

The product will use some kind of detection mechanism to determine if the customer breaks one of the manufacturers terms and '''in retaliation''' disable the online features the customer cared about.

As a result the product has decreased utility and (resale) value, harming the customer.

==Why it is a problem==

'''Manufacturer directly inflicts harm'''
The manufacturer has the ability to inflict immediate and direct harm by reducing the utility and value of the product whenever the manufacturer sees fit, based on terms that the manufacturer imposed.
Even if the customer has any recourse available, the manufacturer can decide to keep online features disabled during the dispute.

'''Chilling effect'''
Customers may refrain from using their product in otherwise legal ways, due to fear of the manufacturer retaliating.

'''Anti-competitive'''
Business may use this tactic to force the consumer to only buy only first party accessories / replacement parts. Regardless of whether the third party products can be legally put on the market, the manufacturer can still threaten the customer with an online ban. This stifles competition in the product's after-market.

'''Perverse incentive to add online features'''
Manufacturers may design their products with an unnecessary reliance on online features to use it as an enforcement mechanism, rather than adding value to the product.

[[File:Bricked Switch 2.png|thumb|A screenshot from a [https://www.youtube.com/watch?v=ExgYTA18_vo&t=656s video by Scattered Brain], displaying his Switch 2 console being bricked]]

==Examples==
Some examples of disabling online features in retaliation include:

* [[Nintendo Switch 2]] consoles disabling [[Nintendo Switch Online]] functionality when MIG Switch cartridges are detected.<ref name=":3">{{Cite web |last=Scattered Brain |date=Jun 16, 2025 |title=Soo... Nintendo banned my Switch 2 (Don't try the MIG Switch!) |url=https://www.youtube.com/watch?v=ExgYTA18_vo&t=656s |access-date=Jun 18, 2025 |website=[[YouTube]]}}</ref>
* [[Molekule Air Purifier|Molekule Air Purifiers]] disabling Molekule Services (required for using the Molekule app) when 3rd party replacement filters are detected.<ref>{{Cite web |last=Louis |first=Rossmann |date=2025-10-04 |title=YouTube: Air filters have DRM now 🤦‍♂️ |url=https://www.youtube.com/watch?v=LCu_n2Nddu0 |website=YouTube}}</ref>

==References==
{{reflist}}

[[Category:Common terms]]
[[Category:Theme]]

Disabling online features in retaliation

2025-10-04T16:10:21Z

Beanow: Add examples

Disabling online features in retaliation

2025-10-04T15:51:15Z

Beanow: Starting the page

Click-to-cancel

2025-10-04T15:13:45Z

Beanow: Add to Theme category

The '''click-to-cancel''' (CtC) rule is a [[Federal Trade Commission]] (FTC) rule, specifically [https://www.ecfr.gov/current/title-16/chapter-I/subchapter-D/part-425/section-425.6 16 CFR Part 425.6], which requires that subscription services make it as easy to cancel the service as it was to sign up.<ref>https://www.ftc.gov/news-events/news/press-releases/2024/10/federal-trade-commission-announces-final-click-cancel-rule-making-it-easier-consumers-end-recurring</ref> This is designed to combat an anti-consumer practice, where a subscription service makes it very easy to sign up for a service, but requires the customer to jump through hoops to cancel the subscription. The law has been finalized and was initially set to go into effect May 14, 2025.<ref>https://www.federalregister.gov/d/2024-25534/p-6</ref> On July 8, the U.S. Court of Appeals for the Eighth Circuit blocked the click-to-cancel provision, reasoning that the FTC erred by not first conducting a preliminary regulatory analysis of the rule's costs and benefits. The analysis must be conducted on any rules that impact the economy by more than $100 million. The FTC can still petition the Supreme Court to review the decision through October 6, 2025 <ref>{{Cite web |last=Fouse-Hopkins |first=Lindsay |date=2025-07-17 |title=Eighth Circuit blocks Click-to-Cancel Rule |url=https://www.clarkhill.com/news-events/news/eighth-circuit-blocks-click-to-cancel-rule/ |url-status=live |access-date=2025-07-17 |website=Clarkhill.com}}</ref>

==How it works==
The rule prohibits the following:<ref>https://www.ftc.gov/system/files/ftc_gov/pdf/NegOptions-1page-Oct2024-v2.pdf</ref><ref name=":0">https://www.govinfo.gov/content/pkg/FR-2024-11-15/pdf/2024-25534.pdf</ref>

*to misrepresent any material fact made while marketing using a negative option feature
*to fail to clearly and conspicuously disclose material terms prior to obtaining a consumer’s billing information in connection with a negative option feature
*to fail to obtain a consumer’s express informed consent to the negative option feature before charging the consumer
*to fail to provide a simple mechanism to cancel the negative option feature and immediately halt charges

A "negative-option feature" is defined by the FTC as "a provision in an offer or agreement to sell or provide any goods or services 'under which the customer’s silence or failure to take an affirmative action to reject goods or services or to cancel the agreement is interpreted by the seller as acceptance of the offer'".<ref name=":0" /> In other words, it is a feature of a service, where once a subscription is initiated, the customer will continue to be billed until they actively cancel the subscription.

The click-to-cancel rule is not limited to electronic services, as the name might suggest. It includes, but is not limited to "Interactive Electronic Media, telephone, print, and in-person transactions."<ref>https://www.federalregister.gov/documents/2024/11/15/2024-25534/negative-option-rule#sectno-citation-425.1</ref> The cancellation mechanism must be "at least as simple as consent".<ref>https://www.federalregister.gov/d/2024-25534/p-1164</ref> The customer may not be required to interact with a representative, whether a real human or a chat bot, if the customer was not required to do so when they signed up for the service.<ref>https://www.federalregister.gov/d/2024-25534/p-1166</ref> For services which were signed up for in-person, the seller must allow cancellation online or over the phone.<ref>https://www.federalregister.gov/d/2024-25534/p-1168</ref>

==Examples of abuse==

===Gym memberships===
Gym memberships are a notorious example of being significantly more difficult to cancel than they were to sign up for. While some states, such as California<ref>https://leginfo.legislature.ca.gov/faces/billCompareClient.xhtml?bill_id=202320240AB2863&showamends=false</ref> already had laws analogous to CtC, gym locations outside of those locations have continued to make it easy to sign up, yet difficult to cancel.

====Planet Fitness====
Prior to state-level laws, Planet Fitness's FAQ stated that "You can fill out a cancellation form at the front desk of your home club, or send a letter (preferably via certified mail) to your club requesting cancellation. Memberships can’t, unfortunately, be cancelled by email or phone"<ref>https://www.planetfitness.com/about-planet-fitness/customer-service/membership-faqs</ref> despite allowing online signups. As of Jan 18, 2025, its terms state "our cancellation process may vary from club to club", and that "Some members may also be eligible to cancel their membership online based on their membership type and the location of their home club."<ref>https://archive.ph/XSG0Q</ref> As of Feb 17, 2025, the link to the "[https://www.planetfitness.com/about-planet-fitness/contact-us Member Services department]" leads to a 404 page.

As of June 10, 2025, Planet Fitness (https://www.planetfitness.com/) requires billing (credit card and bank account) information before clearly and conspicuously disclosing material terms of its negative option in violation of [https://www.ecfr.gov/current/title-16/chapter-I/subchapter-D/part-425 FTC 16 CFR Part 425.4].

====LA Fitness====
In a similar vein, LA Fitness's current policy states that "via your online account or as may otherwise be provided in your agreement (for example, depending on your state of enrollment, you may be able to cancel by email)", but previously stated that they "recommend you mail the notice by certified mail and keep a record for your files. Or, you can deliver the notice directly to the Operations Manager at the nearest LA Fitness facility between 9AM and 5PM on Monday through Friday."<ref>https://web.archive.org/web/20210616083544/https://lafitness.com/Pages/MembershipQuestions.aspx#</ref>

===Free-to-pay===
"Free-to-pay" is a technical term for free trials with a negative-option feature.<ref>https://www.ftc.gov/system/files/documents/public_statements/1598063/negative_option_policy_statement-10-22-2021-tobureau.pdf</ref> In many cases, rather than providing a free trial with no strings attached, and only billing the customer if they decide to sign up, the vendor collects payment information as a prerequisite of the free trial, and automatically bills the customer if they fail to affirmatively cancel the trial (a negative-option feature).

While it does not outright prohibit this practice, the click-to-cancel rule partially alleviates these issues by requiring clear disclosures and consent. According to state AGs, "advertisements for free-to-pay conversion offers often lure consumers by promising a 'free' benefit while failing to clearly and conspicuously disclose future payment obligations".<ref>https://www.federalregister.gov/d/2023-07035/p-83</ref> The FTC also states that:<ref>https://www.federalregister.gov/d/2023-07035/p-87</ref><blockquote>Other studies reveal similar trends. TINA noted the FBI's internet Crime Complaint Center recorded a rise in complaints about free trial offers, growing from 1,738 in 2015 to 2,486 in 2017, with losses totaling more than $15 million. Similarly, a 2019 Bankrate.com survey cited by NCL found that 59% of consumers have signed up for “free trials” that automatically converted into a recurring payment obligation “against their will.” In NCL's view, these data point to “a troubling, and costly problem for American consumers.” </blockquote>

===Adobe===
[[Adobe]] allegedly "trapped customers into year-long subscriptions through hidden early termination fees and numerous cancellation hurdles", according to the FTC.<ref>https://www.ftc.gov/news-events/news/press-releases/2024/06/ftc-takes-action-against-adobe-executives-hiding-fees-preventing-consumers-easily-cancelling</ref> Some of their plans are confusing "annual paid monthly" plans, in which the customer receives a discount as if they had signed up for an annual subscription, but are billed monthly. The FTC alleges that they did not prominently disclose the early termination fee associated with these plans, which is half of the remaining monthly payments if the consumer cancels before the annual subscription runs its course. The complaint also alleges that the cancellation process is difficult and costly:<blockquote>In addition to failing to disclose the ETF to consumers when they subscribe, the complaint also alleges that Adobe uses the ETF to ambush consumers to deter them from cancelling their subscriptions. The complaint also alleges that Adobe’s cancellation processes are designed to make cancellation difficult for consumers. When consumers have attempted to cancel their subscription on the company’s website, they have been forced to navigate numerous pages in order to cancel. When consumers reach out to Adobe’s customer service to cancel, they encounter resistance and delay from Adobe representatives. Consumers also experience other obstacles, such as dropped calls and chats, and multiple transfers. Some consumers who thought they had successfully cancelled their subscription reported that the company continued to charge them until discovering the charges on their credit card statements.</blockquote>

====Brigit====
Brigit is a cash-advance app. The FTC complaint alleges that the company "used manipulative design tricks to create a confusing and misleading cancellation process that made it difficult for consumers to cancel their subscriptions."<ref>https://www.ftc.gov/news-events/news/press-releases/2024/11/ftc-sends-more-17-million-consumers-harmed-brigits-deceptive-claims-junk-fees-confusing-cancellation</ref>

==References==
<references />

[[Category:Common terms]]
[[Category:Positive practices]]
[[Category:Theme]]

Forced arbitration

2025-10-04T15:12:49Z

Beanow: Add to Theme category

'''[[wikipedia:Arbitration|Forced arbitration]]''' is a practice in which businesses can require their customers to resolve disputes through arbitration, instead of a traditional court system. Per Wikipedia: "Arbitration is a formal method of dispute resolution involving a third party neutral who makes a binding decision."

==How it works==
Businesses will typically add an arbitration clause to their [[Terms of Service]] or Terms of Use. This clause generally outlines how disputes are handled between the consumer and the business. A good example of a typical arbitration clause can be found in [[Instagram]]'s Terms of Use, which, as of January 6, 2025, is under Section 7.4 - How We Will Handle Disputes:<ref name=":0">{{Cite web |title=Terms of Use |url=https://help.instagram.com/581066165581870/ |url-status=live |access-date=4 May 2025 |website=[[Instagram]]}}</ref><blockquote>"Except as provided below, you and we agree that any cause of action, legal claim, or dispute between you and us arising out of or related to these Terms or Instagram ("claim(s)") must be resolved by arbitration on an individual basis. [[Class action|Class actions]] and class arbitrations are not permitted; you and we may bring a claim only on your own behalf and cannot seek relief that would affect other Instagram users."</blockquote>Currently, in the United States, arbitration clauses such as this one are legal under the [[Federal Arbitration Act]] (FAA).<ref name=":2">{{Cite web |date=30 Jul 1947 |title=TITLE 9—ARBITRATION |url=https://www.govinfo.gov/content/pkg/USCODE-2019-title9/html/USCODE-2019-title9.htm |url-status=live |access-date=4 May 2025 |website=www.govinfo.gov}}</ref> Efforts have been made, however, to prohibit forced arbitration, most notably the [[Forced Arbitration Injustice Repeal]] (FAIR) Act of 2023.<ref>{{Cite web |date=27 Apr 2023 |title=S.1376 - Forced Arbitration Injustice Repeal Act |url=https://www.congress.gov/bill/118th-congress/senate-bill/1376 |url-status=live |access-date=4 May 2025 |website=www.congress.gov}}</ref>

The [[wikipedia:United_Nations|United Nations]] has published a guideline for consumer protections in 2016, which lists the following under IV 11(c):<ref>{{Cite web |date=2016 |title=United Nations Guidelines for Consumer Protection |url=https://unctad.org/system/files/official-document/ditccplpmisc2016d1_en.pdf |url-status=live |access-date=4 May 2025 |website=unctad.org}}</ref><blockquote>"Businesses should provide complete, accurate and not misleading information regarding the goods and services, terms, conditions, applicable fees and final costs to enable consumers to take informed decisions. Businesses should ensure easy access to this information, especially to the key terms and conditions"</blockquote>

==Why it is a problem==

===Revocation of rights===
The practice of forced arbitration is one that is designed to revoke the rights of the consumer. In this case, the consumer's right to sue or participate in a [[class action]] against a business. Instead, the consumer must work with an arbiter of the businesses' choosing behind closed doors to resolve claims, which is widely believed to result in biased outcomes.

====Bypassing of constitutional rights====
Due to the out of place nature of arbitration, various rights granted by the US constitution and its amendments are entirely bypassed.<ref>{{Cite news |last=Zanville |first=Stuart |date=Sep 1, 2015 |title=Forced Arbitration |url=https://www.advocatemagazine.com/article/2015-september/forced-arbitration |url-status=live |archive-url=https://web.archive.org/web/20200921050552/https://www.advocatemagazine.com/article/2015-september/forced-arbitration |archive-date=Sep 21, 2020 |access-date=Mar 5, 2025 |work=Advocate Magazine}}</ref><ref>{{Cite web |last=J. Mann |first=Kimberly |date=1997 |title=Constitutional Challenges to Court-Ordered Arbitration |url=https://ir.law.fsu.edu/cgi/viewcontent.cgi?article=1454&context=lr |url-status=live |access-date=4 May 2025 |website=ir.law.fsu.edu}}</ref><ref>Brunet, Edward, Arbitration and Constitutional Rights (June 24, 1992). North Carolina Law Review, Vol. 71, pp. 81-120, 1992, Available at SSRN: https://ssrn.com/abstract=2284464</ref>

The 7th amendment,<ref>{{Cite web |title=Constitution of the United States Seventh Amendment |url=https://constitution.congress.gov/constitution/amendment-7/ |url-status=live |access-date=4 May 2025 |website=constitution.congress.gov}}</ref> also known as the right to a trial by jury, is bypassed via forced arbitration. Additionally, the 6th amendment,<ref>{{Cite web |title=Constitution of the United States Sixth Amendment |url=https://constitution.congress.gov/constitution/amendment-6/ |url-status=live |access-date=4 May 2025 |website=constitution.congress.gov}}</ref> also known as the right to a speedy trial, is also bypassed by arbitration since arbitrated cases can take excessively longer than traditional public trials,<ref>{{Cite web |date=12 Sep 2024 |title=How Long Does Arbitration Take? A Closer Look |url=https://adrtimes.com/how-long-does-arbitration-take/ |url-status=live |access-date=4 May 2025 |website=adrtimes.com}}</ref> especially when lawsuits that could have been filed under class action, end up being broken up into hundreds of individually arbitrated cases, such as what has happened with ''Bucher Law PLLC Vs. Valve Inc.''<ref>{{Cite web |last=Bucher |first=Will |title=Steam Case Explained |url=https://www.bucherlawfirm.com/steam-case-explained |url-status=live |access-date=4 May 2025 |website=BUCHER LAW PLLC}}
</ref>

===Inconvenient opt-out procedure===
Arbitration is often made inconvenient for users to opt-out of. Instead of giving users the option to do so at sign-up digitally, most businesses will require users to send a handwritten letter within 30 days of their sign-up to opt-out of arbitration. This type of opt-out clause can also be seen in Instagram's Terms of Use:<ref name=":0" /><blockquote>"You can opt out of this provision within 30 days of the date that you agreed to these Terms. To opt out, you must send your name, residence address, username, email address or phone number you use for your Instagram account, and a clear statement that you want to opt out of this arbitration agreement, and you must send them here:" [Address redacted]</blockquote>

This practice is similar to how gyms will often require members to travel to their location or send snail mail to cancel a membership, while an online system could easily be put in its place.

===Conflict of interest===
Companies track performance of arbitrators over time, and as such, are able to pick arbitrators that lean towards the industry rather than the consumer.<ref>{{Cite web |last=Seru |first=Amit |date=Feb 2023 |title=Tipping the scales: Balancing consumer arbitration cases. |url=https://siepr.stanford.edu/publications/policy-brief/tipping-scales-balancing-consumer-arbitration-cases |url-status=live |access-date=4 May 2025 |website=Stanford Institute for Economic Policy Research}}</ref> While both the consumer and company theoretically have some control over the selection of the arbitrator, the company generally has an information advantage in the selection process. Furthermore, individual arbitrators have a long-term financial incentive to bias their rulings in favor of corporations, as the corporation is much more likely to become a "repeat customer" than the consumer. In extreme cases, entire arbitration firms may have a material conflict of interest.<ref>{{Cite web |date=20 Jul 2009 |title=NAF Announcement — Out of Consumer Arbitration |url=http://indisputably.org/2009/07/naf-announcement-out-of-consumer-arbitration/ |url-status=live |access-date=4 May 2025 |website=indisputably.org}}</ref>

==Examples==
Some examples of arbitration clauses in terms and conditions include:

*Instagram Terms of Use - Section 7.4 - How We Will Handle Disputes<ref name=":0" />
*Itch.io Terms of Service Section 15. Class Action Waiver<ref name=":1">{{Cite web |date=2023-04-15 |title=itch.io Terms of Service |url=https://itch.io/docs/legal/terms |website=Itch.io}}</ref> does not force arbitration, but still seeks to revoke rights to participate in class action or collective arbitration proceedings.
*Powell's Books - Has forced arbitration clause in their Term of Use.<ref>{{Cite web |date=2025-05-30 |title=Terms of Use {{!}} Powell's Books |url=https://www.powells.com/info/terms-of-use |url-status=live |archive-url=https://web.archive.org/web/20250528215842/https://www.powells.com/info/terms-of-use |archive-date=2025-05-28 |access-date=2025-05-30 |website=Powell's Books}}</ref>
*Section 13.1. Binding arbitration agreement and class action waiver, of [[Protonmail|Proton]]'s Terms of Service, says " Please read this section and the class action waiver section carefully – it may significantly affect your legal rights, including your right to file a lawsuit in court and to have a jury hear your claims. It contains procedures for mandatory binding arbitration and a class action waiver."<ref>{{Cite web |date=21 Jan 2025 |title=Terms of Service |url=https://proton.me/legal/terms |url-status=live |archive-url=https://web.archive.org/web/20250310210512/https://proton.me/nl/legal/terms |archive-date=10 Mar 2025 |access-date=4 May 2025 |website=Proton}}</ref>
*[[Sony]] PlayStation Network Terms of Service - Section 14 - Binding Individual Arbitration<ref>{{Cite web |title=PLAYSTATION NETWORK TERMS OF SERVICE AND USER AGREEMENT |url=https://www.playstation.com/en-us/legal/psn-terms-of-service/ |archive-url=https://web.archive.org/web/20241216114722/https://www.playstation.com/en-us/legal/psn-terms-of-service/ |archive-date=16 Dec 2024 |access-date=4 May 2025 |website=[[PlayStation]]}}</ref>
*[[Spotify]]'s End User Agreement, since 2015, contains a Mandatory Arbitration Agreement and Class Action Waiver<ref>{{Cite web | title=Spotify Terms of Use |url=https://www.spotify.com/us/legal/end-user-agreement/ |archive-url=https://web.archive.org/web/20250901121247/https://www.spotify.com/us/legal/end-user-agreement/#6-problems-and-disputes |archive-date=1 Sep 2025 |access-date=5 Sep 2025 |website=[[Spotify]]}}</ref>
*[[Ticketmaster]] Terms of Use - Section 17 - Mandatory Arbitration Agreement and Class Action Waiver<ref>{{Cite web |title=Mandatory Arbitration Agreement and Class Action Waiver |url=https://help.ticketmaster.com/hc/en-us/articles/10468830739345-Terms-of-Use |archive-url=https://web.archive.org/web/20250105150022/https://help.ticketmaster.com/hc/en-us/articles/10468830739345-Terms-of-Use#section17 |archive-date=5 Jan 2025 |access-date=4 May 2025 |website=[[Ticketmaster]]}}</ref>
*Western Digital - Has a forced-arbitration clause in the warranty for a ST500DM002-1BD142 hard drive. Clause 1, section "C". (And possibly other products.) <ref>{{Cite web |title=Warranty {{!}} Western Digital |url=https://consumerrights.wiki/File:WD-HDD-Warranty.pdf}}</ref>
*Yahoo Terms of Service - Section 14.2.b "'''BINDING ARBITRATION AGREEMENT'''" <ref>{{Cite web |title=Yahoo Terms of Service {{!}} Yahoo |url=https://legal.yahoo.com/us/en/yahoo/terms/otos/index.html |url-status=live |archive-url=https://web.archive.org/web/20250315082242/https://legal.yahoo.com/us/en/yahoo/terms/otos/index.html |archive-date=2025-03-15 |access-date=2025-03-15 |website=Yahoo}}</ref>
*Zenimax Media (Bethesda) has an arbitration agreement that can only be opted out of within 30 days, ''by mail''.<ref>{{Cite web |title=ZeniMax Terms of Service |url=https://www.zenimax.com/en/legal/terms-of-service |access-date=2025-05-31 |website=ZeniMax Media}}</ref>
*Section 27.1 of [[Zoom]]'s Terms of Service, says: "You and Zoom agree that any dispute or claim between you and Zoom arising out of or relating to this Agreement or the Services (a “Dispute”), including any related software, hardware, integrations, advertising or marketing communications, your account, or any aspects of your relationship or transactions with Zoom, will be resolved by binding arbitration, rather than in court."<ref>{{Cite web |date=11 Aug 2023 |title=Zoom Terms of Service |url=https://www.zoom.com/it/trust/terms/?cms_guid=false&lang=null |url-status=live |access-date=4 May 2025 |website=[[Zoom]]}}</ref>
*[[Roku]], in March of 2024, prompted a pop-up on its devices for the tv owners to accept [[Roku#Post-Purchase EULA Modification (Mar. 2024)|new terms of use]], which included preventing "mass arbitration" from multiple plantiffs, before being able to use their devices. Opting out can be done by mail, but only after accepting the agreement shown on the TV.[https://www.consumerreports.org/electronics-computers/tvs/why-is-roku-disabling-tvs-a1111833568/]
*As of 2025-08-22, Indeed Terms of Service - Section D: General Terms for All Users - 12. Arbitration Agreement<ref>{{Cite web |title=Terms of Service |url=https://www.indeed.com/legal#d12 |url-status=live |archive-url=https://web.archive.org/web/20250825081104/https://www.indeed.com/legal#d12 |archive-date=2025-08-25 |access-date=2025-09-02 |website=[[Indeed]]}}</ref>

==References==
{{reflist}}
[[Category:Anti-Consumer Practices]]
[[Category:Common terms]]
[[Category:Rights Stripping]]
[[Category:Theme]]

Category:Theme

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