EXCLUSIVE: Disney has raised serious concerns about new UK laws that will require it to send contract renewal notices to Disney+ users and allow customers to “game” the streaming service without paying.
The U.S. media giant said the UK government’s draft Digital Markets, Competition and Consumers Bill was attempting to “micro-manage” the way subscription streamers interact with their customers.
In its current form, the legislation will require streamers to send “reminder notices” to customers every six months to make them aware that they remain subscribed.
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Disney said that it already provides “timely and clear notice” of a recurring fee and makes it easier for users to cancel their contract than subscribe in the first place.
The company added that increased email notices could actually have a counterproductive effect because it will make users more likely to ignore the messages they receive.
In a submission to the Lords Communications and Digital Committee, Disney said: “The combination of the market imperatives, consumer preferences, our practice of providing timely and clear notice of the recurring fee and the ease of terminating the agreement should obviate the need for mandated renewal notices.
“At a minimum, it obviates the need for the micro-managing of how and when these notices should be sent, which is a serious flaw in the draft bill that fails to recognise that it could lead to consumer’s ignoring notices.”
Disney requested that the UK government limit the reminder notices to sectors that have a track record of “attempting to trap their consumers.” This “obviously does not apply to SVODs,” it added.
Price Hike Warning
Furthermore, Disney raised concerns about the Digital Markets, Competition and Consumers Bill’s effort to introduce a 14-day cooling-off period for digital subscription services. This would allow users to withdraw their subscription within two weeks and not pay for the service.
Disney said this would empower people to “game the system” by subscribing, bingeing all the content they want to watch, and then canceling. Disney warned that this could result in price hikes for loyal customers.
“This would allow these bad actors to benefit from our service without compensation to the detriment of the vast majority of good actors as it could likely result in a price increase given the reduction in the subscriber base and the high cost of producing high-quality content,” it said.
COBA, a trade body that counts Sky, Fox, and NBCUniversal among its members, raised similar concerns to Disney. It said the Digital Markets, Competition and Consumers Bill is “overly prescriptive.”
The UK government’s Department for Business & Trade said: “Our new Digital Markets, Competition and Consumers Bill will boost competition in online markets that are currently dominated by a small number of firms – delivering on our commitment to grow the economy by increasing consumer choice and accelerating innovation.”
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