Uber One faces backlash as FTC digs into customer grievances

The U.S. Federal Trade Commission (FTC) has launched an investigation into Uber Technologies Inc.’s subscription service, Uber One, following customer complaints about unauthorized enrollments and difficulties in cancellation. The probe, which began earlier in 2024, adds to the scrutiny surrounding subscription-based models in various industries.

Uber One, which offers discounted rides and food deliveries for an annual membership fee, reportedly has 25 million subscribers. While the FTC has not commented on the investigation, Uber confirmed that the agency had contacted the company and stated that it is cooperating fully with the review.

In response to the allegations, Uber spokesperson Noah Edwardsen clarified that cancellations can be processed easily within the app, often taking less than 20 seconds. Despite this, the FTC’s inquiry seeks to determine whether Uber’s subscription policies align with consumer protection laws, especially in light of complaints regarding transparency and accessibility.

The FTC has intensified its focus on deceptive subscription practices, recently suing companies such as Amazon and Adobe for allegedly making cancellations unnecessarily difficult. Additionally, the agency introduced a “click-to-cancel” rule requiring businesses to simplify subscription termination processes. However, this rule is currently facing legal challenges, reflecting ongoing tensions over regulatory enforcement.

Reports suggest that the investigation into Uber One may have been expedited ahead of an administrative transition. Bloomberg reported that the FTC sent Uber a proposed settlement shortly after the November election, prompting allegations from Uber’s attorneys that the agency was rushing negotiations before the presidential inauguration. Uber’s legal team criticized the settlement demands as excessive, claiming that FTC staff rejected a counteroffer without proper consideration.

FTC Commissioner Christine S. Wilson Holyoak, a Republican, has expressed concern over the settlement terms, requesting more information about the handling of cases nearing resolution. Holyoak, alongside other candidates, is reportedly being considered for the role of FTC Chair under the incoming administration.

As the investigation continues, it highlights the growing scrutiny of subscription-based business practices. The outcome could have broader implications not only for Uber but also for other companies navigating regulatory oversight in a shifting political landscape.