More people suffer from 'unfair' online subscription services

Consumer complaints and damages include service providers banning contract cancellation and not giving refunds

(123rf)

A man in his 30s surnamed Kwak signed up for an online subscription service that provides movies.

Kwak tried to download videos from the webpage, but it never worked, even after multiple tries. So he contacted the service provider and asked for a refund.

The service provider turned him down, saying that the error in Kwak’s case could not be identified.

Amid the increasing demand for online subscription services, especially video or music streaming content, Kwak’s case is an example of how more consumers are recently suffering from unfair treatment from online subscription service providers, the Korea Consumer Agency (KCA) said Wednesday.

A total of 609 consumer complaints or damages related to digital content were submitted to the agency’s counseling center in the last three years, according to the KCA.

Consumer reports related to video contents took up the biggest portion with 136 cases, followed by education and games.

In regards to the types of complaints and damages, there were 218 reports about not being able to cancel the subscription contract and having to pay a penalty.

After researching apps that offer digital content subscription services on Google Play Store and Apple App store in December, the KCA found that 18 of 25 apps limited consumers from withdrawing their subscriptions.

Under the current law, consumers can cancel a subscription within seven days after signing up for the service. But they can only do so for the parts of the digital contents that have not been provided to them yet.

Only four of the 25 surveyed apps gave partial refunds to consumers if they canceled the subscription service before the next month’s payment date, the KCA said.

The other 21 apps allowed a cancellation to take effect on the day of next month’s payment date, so consumers could not be compensated for the period of not using the service.

The KCA said it plans to ask the online subscription service providers to guarantee a consumer’s right to back out of their contract and pay a partial refund to consumers in cases of contract cancellation before the next payment date.

The consumer watchdog added that it will look to propose laws and system changes to related government bodies and ministries in order to effectively prevent damage and help consumers.

By Kan Hyeong-woo (hwkan@heraldcorp.com)

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