Outlook Business Desk
A US federal appeals court has struck down a major consumer protection rule that would have forced streaming platforms to simplify their cancellation processes. The regulation, known as the “click to cancel” rule, was proposed by the Federal Trade Commission (FTC) and set to take effect on July 14.
The rule aimed to boost transparency by requiring clear consent before converting free trials and mandating disclosure of promo pricing end dates—part of the Biden administration’s broader effort to reduce consumer friction in digital services.
The FTC’s rule would have required platforms like Netflix, Prime Video, Disney+ and HBO Max to make cancelling subscriptions as simple and seamless as signing up.
The appeals court ruled that the FTC failed to conduct a required economic impact analysis. As a result, the “click to cancel” regulation has been suspended indefinitely and streaming platforms are no longer bound to offer easy cancellation options.
In 2023, cancelling Amazon Prime Video required four pages, six clicks and 15 prompts—according to an investigation. The FTC later sued Amazon over these practices and the case is still ongoing.
While cancellations are currently easy on most platforms, that flexibility may soon disappear. Without regulatory pressure, companies could add hurdles—more steps, hidden settings or even mandatory customer support calls.
Deloitte estimates that US households now spend around $61 (approx. ₹5,000) per month on streaming—a trend seen in India too. If complex cancellation systems spread globally, users may face unwanted charges for unused services.
Though the ruling applies only to the US, it may influence streaming practices globally, including in India. Easy cancellations are crucial in price-sensitive markets where users manage costs by switching or pausing subscriptions.
As digital rules continue to change, experts advise users to carefully read all the terms and conditions—especially the small details that are often overlooked. Knowing how and when you can cancel a subscription can help you avoid surprise charges, hidden fees, or being stuck in unwanted plans, particularly as streaming platforms try new ways to limit cancellations.