California Law Aims to Make it Easier to Cancel Streamers, Other Subscriptions
The new law requires companies that offer subscriptions to provide online and by-phone methods to cancel.
There’s no two ways about it: streaming services don’t want you to cancel your subscription. This is only natural since their primary goal in getting you subscribed in the first place was to make money off you. But some subscription services don’t make it easy to get out of your account, making you call a customer service hotline that could potentially have you waiting indefinitely before you get to speak to someone. The state of California wants to ease the burden on customers trying to cancel streaming subscriptions and has passed a new law with that aim in mind.
Key Details:
- The new law requires an online option to cancel, as well as affirmative consent from viewers before being enrolled in automatic renewals.
- The Federal Trade Commission has been attempting to craft similar, nationwide rules since 2023.
- One recent survey found that Americans spend almost $400 on subscriptions they don’t use, with Netflix and Disney+ leading streamers.
California governor Gavin Newsome signed Assembly Bill 2863 into law on Tuesday. The bill will cover all subscriptions signed or renewed after July 1, 2025. It doesn’t only cover streaming subscriptions, but any commercial service that requires a subscription, including gyms, mobile phones, news, and video games.
The law applies to subscriptions or agreements that renew automatically, continue until a user cancels, or automatically revert to a paid service after a free trial. Businesses must get “express affirmative consent” before enrolling a consumer’s payment plan in an automatic renewal program.
Companies must also give customers a way to cancel their subscription online in addition to a toll-free phone line, so getting out of a subscription is as simple as getting into it. Services must also send buyers annual messages on the price of their subscription with information on how to cancel, and notify them of any price changes.
“California now has the most comprehensive law in the nation” protecting subscription customers, said Robert Herrell executive director of the Consumer Federation of California. “From gym memberships to software subscriptions to wine clubs, consumers should have control of their subscriptions and no longer endure endless stalling tactics to keep your money.”
Will Other States Follow California’s Lead?
It would hardly be surprising to see California’s new consumer protections regarding subscriptions be enacted elsewhere. Indeed, a similar law requiring affirmative consent from customers and other provisions was handed down in New York in 2021.
The Federal Trade Commission (FTC) has been working on a “Click to Cancel” rule that would be enforced nationwide since 2023. But that rule is subject to objections and other slowdowns that always seem to keep the federal government from moving fast on anything, and California didn’t feel the need to wait for the FTC.
There’s no denying automatic renewals and the difficulty of cancelation can end up costing consumers big money. A June survey found that Americans spend nearly $400 per year on subscriptions they don’t use, with Netflix and Disney+ being the most-unused streaming services. Nearly 40% of viewers said automatic renewals were the main reason they forgot to cancel a subscription in that survey, and that means other states could soon look into creating new rules of their own governing the ease of canceling a subscription.
Disney+
Disney+ is a video streaming service with over 13,000 series and films from Disney, Pixar, Marvel, Star Wars, National Geographic, The Muppets, and more. It is available in 61 countries and 21 languages. It is notable for its popular original series like “The Mandalorian,” “Ms. Marvel,” “Loki,” “Obi-Wan Kenobi,” and “Andor.”