May 2016 Digest — Subscriptions, Cloud & Global Compliance

The fifth month of 2016 is nearly over. So what happened im wunderschönen Monat Mai? It’s time for our review of the news-that-was in our May 2016 digest.

This month on the blog, we covered the difference between user experience and customer experience in a guest post from Shane Barker. We took another look at the AgTech industry and how two companies approach user experience. And we explored three key tips for affiliate marketers to successfully leverage social media. But that’s not everything of note that happened. Below, we feature key stories from the past month about subscriptions, the cloud and global compliance.

Subscriptions in the News

Trapping You in a Club You Didn’t Know You Joined | Bloomberg

In the growing world of subscriptions, unscrupulous companies with abusive (or illegal) policies are getting attention. In Bloomberg’s recent feature, they highlight Adore Me, an online subscription company that ships lingerie to their subscribers. Sounds like many other subscription box companies we hear so much about. But these subscriptions must adhere to the provisions in ROSCA against negative option billing, or defaulting customers into a recurring billing agreement without upholding specific transparency standards. The law states that any subscription or recurring billing agreement must “provide simple mechanisms for a consumer to stop recurring charges from being placed on the consumer’s credit card, debit card, bank account, or other financial account.”

may 2016 digest
Source: Adore Me

Here’s where Adore Me ran in to trouble. By signing customers up automatically for their VIP package, and then making cancellation of the package practically impossible, Adore Me inspired a torrent of customers to contact the FTC to complain. “Canceling what one customer described in an FTC complaint as the ‘seemingly inescapable VIP package’ can be an aggravating process. ‘I never opted in for monthly billing,’ another Adore Me customer wrote to the FTC, ‘and yet now it is MY responsibility to chase them down to tell them I wish no longer to be enrolled?'”

Oregon State University to Test Subscription-Based On-Demand Tickets for Sporting Events | SportTechie

may 2016 digest
Source: SportTechie

Subscription models are making their way into college sports. Oregon State University is rolling out a subscription program for sporting events. SportTechie notes, “Oregon State deputy athletic director Zack Lassiter said, ‘We’re not trying to maximize revenue… We’re trying to create a price that resonates with our young alums.’ This on-demand ticket options allows SQUAD users to sit with each other at games, and also provides the option to upgrade to better seats, even at the last minute.”

Head in the Cloud

10 Industries That Have Embraced the Cloud |

The cloud is becoming essential to business in more sectors every day. compiled this list of 10 industries that have embraced cloud computing. Based on data from Okta, author and Okta COO Frederik Kerrist summarizes his company’s findings by looking at cloud adoption in Software, Marketing, Biotech/Pharma, Real-Estate, Not-for-Profit and five other industries with their heads in the cloud.

Strengthening Authentication Through Big Data | TechCrunch

may 2016 digest
Source: TechCrunch

The cloud is also beefing up authentication technology. We all know passwords are easy to crack, and other authentication technologies are often cumbersome for users, spoiling their experience. But fear not: “As a result of dramatic decreases in data storage costs and the explosion of cloud services, data collection technologies and advancements in web platforms and mobile technology,” connecting large data sets from disparate sources is simultaneously making authentication processes more secure and easier on users.

Global Compliance

Compliance Management Increasingly Key For Digital Payments And Subscription Processors | Forbes

Forbes magazine sat down with cleverbridge’s own Craig Vodnik to talk about tax and privacy compliance in the online payment and subscription management industry. He and cleverbridge’s Director of Global Compliance and Information Security, Daniela Hagen, emphasized challenges related to the recently adopted General Data Protection Regulation and tax laws which change frequently and vary from jurisdiction to jurisdiction. Vodnik noted that while, in the past, an online retailer might have simply taken the risk, “Now you’re going to have think about whether you’ll be required to pay back taxes [or other penalties]. It’s an open question that people haven’t thought about much.”

Facebook Moments Launches in EU and Canada Without Facial Recognition | TechCrunch

Because of the data protection laws in the EU and Canada, Facebook has disabled facial recognition technology in their photo-sharing app Moments for those jurisdictions. “Facebook says it instead uses a form of object recognition, which is based on features like the distance between a person’s eyes and their ears,” and not on any personal information that users have provided to Facebook.

may 2016 digest
Source: TechCrunch

The article notes that this method is not as accurate as true facial recognition, and may also diminish the quality of the user experience depending on the user’s location. “This makes the app a bit more labor-intensive, as it now can’t automatically identify who is in your photos – it can only suggest that a group of photos that may contain the same person.”

United States: First Circuit Decision Increases Risks to Businesses Under VPPA | Mondaq

The First Circuit US Federal Court recently took up a case involving the 1988 Video Privacy Protection Act (VPPA), which prohibits companies that sell or rent video to consumers, renters or subscribers from disclosing any personally identifiable information to third parties. Mondaq deeply analyses the legal implications in their coverage of the ruling. TechCrunch also has an excellent discussion on their site through the lens of the tech industry.

The plaintiff in this case claims USA Today illegally provided his viewing and location data to Adobe for use in their analytics tool. Two important things to catch with this ruling: First, specifically if your company provides video services, be very careful about the way you use user data and share it with third parties. Equally important, the court found that the plaintiff in the case, who had downloaded a free app from USA Today, did count as a subscriber under the definitions in the law. While lower courts had reasoned that a subscriber had to pay subscription fees, this court’s embrace of a broader idea of the subscription governing a customer relationship updates the court’s understanding of the law to match current industry practice.

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