Amazon tricked customers into buying a more expensive Prime subscription when they just wanted to stream videos, FTC says
- A new FTC lawsuit accused Amazon of tricking customers into buying a more expensive subscription.
- The agency said Amazon made it hard for customers to sign up for Prime Video, a streaming service.
The Federal Trade Commission accused Amazon in a new lawsuit of tricking customers into purchasing full — and more costly — Prime memberships when they were only looking to stream videos available on Amazon's subscription video service.
Prime Video is Amazon's subscription streaming service, where customers can watch and rent shows and movies for an $8.99 monthly fee. It's a separate product from a full Amazon Prime membership, which costs $14.99 monthly.
And although "it is possible to sign up for Prime Video alone, it is difficult to do so," the FTC said in a complaint filed on Wednesday.
The complaint alleged that Amazon's website was set up in a way that tricked customers out of the lower-cost Prime Video subscription. Colored buttons encouraged and redirected customers to sign up for a full Amazon Prime subscription, the complaint said.
"Capitalizing on some consumers' inability to appreciate the difference between 'Prime' and 'Prime Video,' the Prime Video enrollment process fails to clarify Amazon will enroll them in Prime rather than the less expensive Prime Video, on both desktop and mobile platforms," the complaint said. "This causes some consumers to enroll in Prime, rather than Prime Video, unknowingly."
An Amazon spokesperson said the FTC's claims in its complaint were "false on the facts and the law."
"The truth is that customers love Prime, and by design we make it clear and simple for customers to both sign up for or cancel their Prime membership," the spokesperson said in an e-mailed statement. "As with all our products and services, we continually listen to customer feedback and look for ways to improve the customer experience, and we look forward to the facts becoming clear as this case plays out."
The FTC's lawsuit against Amazon was in part sparked by Insider's report last year that showed how the company worried for years that it tricked customers into signing up for Prime subscriptions. In last year's report, Insider found that Amazon had embarked on an initiative to make it easier for customers to distinguish what content on Prime Video was free or not, which they called Project Clean Slate.
"Clean Slate reimagines the Prime Video CX across devices and surfaces, with a focus on simplifying the discovery of content free to Prime members to ensure our service is useful and personal," an internal document obtained by Insider said.
The FTC complaint also alleged that Amazon "tricked" customers into signing up for a Prime subscription and then made it difficult to cancel the memberships.
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