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Adobe has agreed to pay the US government $75 million to settle its lawsuit over the company's allegedly harmful approach to subscriptions. The suit started in 2024, when the US Department of Justice and the Federal Trade Commission filed a joint complaint alleging the company deliberately made it difficult to cancel subscriptions and obscured the frequently expensive "early termination fee" customers have to pay to get out of annual subscriptions that are paid monthly.
"While we disagree with the government's claims and deny any wrongdoing, we are pleased to resolve this matter," Adobe writes. "We have agreed to provide $75 million worth of free services to customers that qualify. We will proactively reach out to the affected customers once the appropriate filings with the Court are made and accepted. Additionally, we have agreed to a $75 million payment to the Department of Justice."
Adobe's statement also notes that it's made the process of both signing up for and canceling subscriptions "more streamlined and transparent." A major sticking point of the original complaint is that canceling an "annual plan, paid monthly" subscription before completing the first year of service required customers to pay an early termination fee to make up for the value Adobe lost initially offering its software at a discount. Adobe currently allows plans to be refunded if they're canceled within 14 days after signing up, but canceling an "annual plan, paid monthly" subscription after those first 14 days requires paying a hefty fee (as outlined in the company's
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Adobe's long-time CEO has shared that he plans to step down. Shantanu Narayen has been the chief exec at the tech company for 18 years, a tenure where he led Adobe in the major shift to become a software-as-a-service provider. The exact timeline for his exit is still up in the air, as Narayen will depart when the board of directors names his successor. He will remain on the board as its chair after leaving the CEO post.
While Adobe was not the first to take the SaaS route, it was one of the first major tech operations to do so. Software such as Photoshop, Illustrator, Premiere and Lightroom from the brand have been mainstays in creative fields for years, so the launch of the Creative Suite subscription, which is now called Creative Cloud, was a pretty revolutionary change for its customers.
In an memo to employees, Narayen reflected on his nearly two decades at the helm. Adobe has grown from about 3,000 employees to more than 30,000, while its financial performance has leapt, revenue skyrocketing from less than $1 billion to more than $25 billion. He also looked toward the future and the seemingly-inevitable presence of artificial intelligence.
"The next era of creativity is being written right now — shaped by AI, by new workflows and by entirely new forms of expression," he wrote. "Adobe has never waited for the future to arrive. We've anticipated it. We've built it. And we've led it. What gives me the greatest confidence isn't just our technology — it's our people. Your ingenuity, resilience and commitment to customers are what will define this moment."
This article originally appeared on Engadget at https://www.engadget.com/big-tech/adobe-ceo-shantanu-narayen-plans-to-step-down-after-18-years-21270562
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