Media Trades Blast Proposed 'Click To Cancel' Rules

The online ad industry, cable lobby and other business groups on Tuesday argued against the Federal Trade Commission's so-called “click to cancel” proposal, which the agency says will enable consumers to easily cancel recurring fees such as subscriptions that automatically renew.

The proposal “will have significant negative ramifications for our members,” Lartease Tiffith, the Interactive Advertising Bureau's executive vice president for public policy told administrative law judge Carol Fox Foelak at an hour-long hearing.

Michael Powell, president and CEO of NCTA -- The Internet & Television Association, added that the proposed rules were “unjustifiably broad.”

“In many industries like ours, automatic renewals are the only model that make any sense,” Powell said, adding that the proposal “risks upending popular familiar services that consumers expect and enjoy.”



The hearing addressed a proposal the FTC issued in March for a series of rules, including ones that would require companies to offer consumers a simple cancellation mechanism, and let people cancel subscriptions through the same medium that was used to purchase them.

Another proposed rule would restrict companies' ability to “save” a subscription by talking people out of cancelling. While the proposal would allow companies to make better offers to people who try to cancel, the companies would have to first ask consumers whether they want to hear the offers.

Tiffith said such a rule could unconstitutionally restrict speech that isn't misleading or unlawful.

“The proposed ban on so-called saves, absent consumer consent to receive a save, poses serious First Amendment concerns,” he said.

Powell added that the proposed restriction could create “speed bumps on conversations between consumers and their providers,” which would deny consumers “a rightful chance at a better deal.”

Other speakers included representatives from the International Franchise Association, Performance Driven Marketing Institute, FrontDoor and the policy group TechFreedom.

Tiffith and some other participants also raised procedural objections to the hearing, at which each speaker was given 10 minutes to make a presentation.

Foelak said she may hold a further hearing in two weeks, and that the parties could submit additional written briefs by January 23.

The IAB had argued in a filing late last year that it should be able to cross-examine witnesses before the FTC decides to move forward with new restrictions on businesses. Tiffith reiterated that argument on Tuesday, adding that a one-hour hearing, at which there was no opportunity for cross-examination, was a “severely deficient” process.

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