One Easy Pro-Consumer Trick Congress Will Never Pass

MY FRIEND RICHARD RUSHFIELD over at the Ankler noted briefly earlier this week that Italian courts had not only reversed a price increase enacted by Netflix but also required a refund of previous price increases. This led Richard to write the following:

So imagine that. In some countries, laws prevent companies from simply shoving an increase down their customers’ throats without making it abundantly clear what they are doing and why.

The idea that one’s customers are not just piggy banks to be shaken until all the coins fall out but partners in a relationship is nice to hear about, if it exists somewhere.

I understand the need to charge more to deliver more, which is what Netflix would say they’re doing. You see it all the time. I’ll just use a personal-professional example: Not long ago, The Bulwark itself raised the monthly rate from $10 to $12 a month for new subscribers, in no small part because we’ve added a whole raft of newsletters and writers, great additions like Adrian Carrasquillo, Catherine Rampell, Lauren Egan, Mark Hertling, and Will Sommer … to say nothing of new editors like Sam Stein, new video producers, and whole support teams to ensure that the trains run on time. Trust me: I look at the expansion inside The Bulwark and just marvel at how quickly and largely it has grown. That growth is made possible by our Bulwark+ members—and if you’re among them, thank you.

If you aren’t a paying member yet, well, here’s your chance. The good news is that the price of a yearly sub remained static, while a monthly sub is now $12 a month . . . meaning that signing up for a year saves you nearly a third off the monthly rate. Given that we’re also running a special giving you the first two weeks for free, you’re basically losing money by not signing up for an annual sub to take advantage of all the ad-free videos, the legions of podcasts, and newsletters via our brand-new handy-dandy app (available on Apple and Google).

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That said, it has become incredibly obvious that the business model of certain streamers, particularly the larger ones, is largely one of inertia. Most people don’t actively monitor how much they’re paying for each sub, and the renewal charges go through automatically because people just sign up for recurring payments with their credit cards. It’s all automated. There’s no friction for a price increase. My Disney+ sub has almost doubled in price over the last few years and I barely even notice it because it’s one of a thousand lines on a credit card statement. And their longer-term hope is to move some of those ad-free subscribers into the ad-supported tier, as advertising is where the real monetary growth will likely be in the future.

The Biden-era FTC tried to introduce some friction with its “click-to-cancel” rule, which would have required easier means of canceling subscriptions and active affirmation for price increases. The click-to-cancel rule was voided unanimously last year by the Eighth Circuit. I am in no position to judge the merits of this ruling, so I’ll just assume, for argument’s sake, that they handled it correctly; the Constitution is a tricky thing.

But that assumption allows me to make another assumption: Congress could absolutely pass a law demanding that service providers a.) make it easier to cancel subscriptions and b.) require active consent to increase prices. (Seems like pretty straightforward interstate commerce, no?) The form that active consent should take I leave up to the legislature, though I might add that merely clicking a button confirming the price increase simply will not do. There should be some further step, a requirement to restate the credit card number tied to an account, perhaps. Something to make the customer actually think about what they’re doing.

Because, let’s be real: Netflix’s decision to raise prices for the second time in less than a year feels pretty egregious. And I bet a lot of people, if they think about it, might not think it’s worth all that extra cash every year.

Anyway, I’m not in the business of offering the GOP Congress easy wins. But I genuinely cannot think of an easier win than ‘make it harder for faceless streaming companies to charge you more the sub you already have.’ And if they decide this is too hard? That they have better things to do than try to protect consumers from predation by the tech lords? Well, hey. Seems like an easy win for the sure-to-be-incoming Democratic majority, no?

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