Friday, May 14, 2010


Paywall crumbling? Maybe not yet, but beware of automatic renewals

by Larry Geller

What goes on forever, even beyond your own lifetime? Your Civil Beat subscription, it seems.

Peer News/Civil Beat announced a new “daily membership” today. Visiting their membership page I was reminded that the $.99 trial rate takes you to $19.99 auto-renewal, which is what they are really after. Oh, you don’t see that on the page? Click the trial button on the upper right like you were going to actually do it. Peek-a-boo. Only then do they reveal the perpetual nature of your $.99 payment commitment is $19.99 a month.

Isn’t that something like the fine print on the back of many magazine discount subscription forms that you are not supposed to read? Stuff like “by accepting this offer you agree that your subscription will be renewed annually at the then current subscription rates.” There is information about automatic renewal on the web, for example The Legal Side: Is automatic renewal a deceptive business practice?

The problem is that you can drop dead and PayPal will continue to renew, eventually depleting your bank account. Or you could be hospitalized or something like that, or lose your Internet access, but Civil Beat/PayPal takes your money anyway. Try to cancel a PayPal account if you can’t get onto the Internet ‘cause you’re flat on your back in Queens. Or maybe you just stop visiting the site, but you don’t stop paying.

The term “automatically renewed” doesn’t appear in their Terms of Service that I could find. It’s couched in terms of cancelling your membership. That seems to me not unlike what the magazine scams tried by obscuring the perpetual nature of the payment. Yes, their lawyers have checked it, I’m not implying anything is illegal. But I think the way it’s stated is “uncool,” as they might say.

I don’t subscribe to any magazines that require auto-renewal as a condition of subscription. Consumer Reports does, and I paid for it with a card that expires a month after you use it (Citibank and some other card companies provide these temporary card numbers for Internet purchases). It’s one of the negative aspects of Consumer Reports in recent years that I was disappointed to see. I did complain, and they allowed me to renew without the automatic requirement. But I had to go way up the management chain.

Oh, at the bottom of their Terms of Service Civil Beat shouts in all caps:


Even if you stop using the website, you still pay, of course. That’s the problem with auto-renewal.

If the website is so good, why not let users decide to continue another month or not? In other words, opt-in rather than opt-out.

My advice? Only this: Always read the EULA or Terms of Service carefully.

Will this be the wave of the future? Let’s see how it goes.

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Hi Larry,

I think you are confusing the non-renewing Daily membership you start your post with, and the renewing monthly membership. On the page you link to, the "auto renew" aspect of each option is clearly labeled. The non-renewing $1.49 daily membership may be a good option for folks who just want to drop in now and then. Or, the non-renewing $0.99 for a 30-day Discussion membership is another option for folks who don't like auto-renew.



I think I got it right, but how to show in comments? Let's see.... ok, uploaded two pics. Hmmm.. can't do img html here either.
That's the one showing $0.99 but nothing about renewing you forever.

Ok, click the button and you get this one:

Now it says agree to pay monthly unless I cancel.

Maybe it seems like a small thing, but as you see in my post, the whole concept of auto-renewal is troublesome, so at least the potential customer needs to fully understand that the sub isn't going to stop even should they get hit by a truck. And their spouse may not have the PayPal password or even know what is going on. Or maybe even know what PayPal is.

If the above images don't show, try without the files. That's a Blogger kludge.

I understand that I can cancel anytime, Larry. In the meantime focusing on important issues as you do, also, is the reason that I will continue Honolulu Civic Beat.

This type of consumer scam- yes scam- is all too common. I got bit by the NFL when I tried to pay for one month of radio games on-line last year and got billed $9.99 every month until I noticed and called to stop them... it’s the same way those “free credit report” scams work.

Anything with an “opt out” instead of an “opt in” is by definition a rip-off, albeit a legal one... especially ones where not only is it hidden in the fine print but there’s no way to opt out at the point of purchase and you have to make a phone call- sometimes to a not so apparent number- to stop the billing

Too bad we don’t have some kind of on-line investigative news organization who could report on this type of consumer “gotcha”.

Andy, that's been one of my gripes with Consumer Reports. They might be that watchdog, but they engage in the practice themselves.

They also use many schemes to get me to open their renewal or gift sub envelopes. For example, making the envelope look like something important, or other tricks. I should post some scans of their envelopes.

There was a case in 2006 against Time which Hawaii joined in. I don't mean to imply in any way that what Peer News is doing is illegal, just to give background to the objections to automatic renewal systems. Also, if someone enters into them with full knowledge, that's fine.

Putting PayPal in the middle is a complication. I do have automatic monthly payments on my phone bill. It comes from a joint checking account that never has too much in it, it's used for bill paying. If I got hit by a truck, my wife could easily stop the payments if she wished. Not so when a third party is making the payments. She would have no idea what my PayPal password is, or even how to contact them, or how to convince them that she wants to stop a payment sequence that I initiated.

If indeed there are any consequences for subscribing to Civil Beat via PayPal, perhaps they are on the PayPal site. Someone arranging for a PayPal account has to go through whatever process they require and agree to whatever conditions they impose over and above what is in the Civil Beat Terms and Conditions. They do not appear to be related companies.

Hi Larry,

Just to re-iterate: if you are concerned about auto-renewing, we have two options which do NOT auto-renew. That was really my point. So, for $1.49, you can read our content and participate for a single day, and never be charged again, whether you were "hit by a truck" (your words) or not.

For the one auto-renew option we do offer, the monthly full membership, you can't even purchase that option until you click a checkbox next to a very short sentence that plainly states the fee is monthly. Even if you do make that agreement, you can immediately cancel the agreement after your purchase, and it won't renew automatically.

But again, if you're concerned about forgetting to cancel immediately after you buy the monthly plan, I suggest you don't click that checkbox, and that you buy one of the non-renewing options.

I'm not sure how to make it simpler for folks than it already is, but if you have any suggestions, I'm listening.



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Requiring those Captcha codes at least temporarily, in the hopes that it quells the flood of comment spam I've been receiving.

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