An enraged reader, Josh Vickers, writes in today to complain about Slacker’s premium online radio service. Like Pandora, Slacker streams music to users for free. And like Pandora, Slacker limits the number of times you can skip songs each hour, and has advertising.
Both services allow users to remove those limitations if they pay a yearly fee. Slacker charges $48/year. Pandora charges $36/year for their Pandora One service.
The frustration from users isn’t that Slacker charges more. It’s how they market the premium product. Pandora straight up says they’ll charge you $36 to upgrade. No misleading marketing statements. You pay $36 and you get Pandora One for a year.
But Slacker tricks you. They give you a seven day free trial and say it’s $3.99 a month after that. But you get billed for the whole year – $48 – after that seven day period is over. And if you don’t want want to pay for that year, you have to cancel during the seven day period.
Compare the Slacker marketing pitch above to the straighforward way Pandora handles premium subscriptions in the image to the right.
Back to that enraged user. After seeing a $48 charge from Slacker on his credit card when he expected $3.99, emailed Slacker for an explanation, and then tried to cancel. He was denied (messages in chronological order):
Slacker: We hope you have been enjoying the benefits of Slacker Radio Plus. Your subscription has reached its renewal date. Your credit card was charged $47.88 on 08/26/2009 and your Slacker Radio Plus service will continue uninterrupted. Your auto-renewal date is: 08/18/2010. To adjust your account settings at any time, simply log into your Slacker account and enter the Account Management section. Thank you for listening, Slacker
Customer: i was under the understanding I was going to be billed monthly at 3.99 per month. Please advise.
Slacker: Slacker subscription are billed annually. We don’t currently offer a monthly billing plan.
Customer: Please cancel my subscription – thats misleading – should consider revising your message.
Slacker: Once the subscription has past the 7-day trial, you can go through our web site as described below to cancel your subscription so that, once your current subscription has expired, you will not be renewed for another subscription. However, the subscription has to be canceled within the 7-day trial per the contract you agreed to when you signed up for the free trial in order to avoid being billed.
So if you sign up for the free seven day Slacker trial, don’t be surprised when you’re billed for a whole year and can’t cancel. Pandora, by contrast, does give partial refunds. I contacted the company today and they said “It’s a year agreement, but we of course do refunds when people call to request them.”
The difference in how these companies market to customers and then treat them later is night and day. No wonder Pandora is so much more popular – tricking a few people to pay you $48 is fine, but clear messaging and proper customer service will win in the end:
entrapment = adoption
is Joe Francis running slacker radio?
Hey Josh, do a chargeback on your credit card.
They will most likely side with you (if you have Amex they will definitely side with you). This is your best line of defense against unethical companies.
No, Madoff is.
Hmm, after the 7 day trial period, it should only bill you for the next month. Billing for the whole year is robbery!
Not if properly disclosed. In fact, it’s very difficult to operate a profitable business based on monthly payments. Bear in mind that many phone plans call for a 2-year agreement.
In America maybe. Other places do fine without 2 year contracts. There’s a reason why you have the expression “nickel and dime” here — businesses are always trying to fuck their customers.
The point is that it was not properly disclosed here based on that screenshot (even if they stuck it in some fine print). Besides, it is not our job to figure out if a business is using a sustainable business model – it’s theirs. He only agreed to what was so clearly laid out in the $3.99 per month claim. (And yes, plenty of services charge low monthly rates like that)
Yeah, but phone contracts are subsidizing hardware, Slacker is not.
So wait, because you didn’t read the page or terms and conditions, you’re claiming it’s unfair? When I signed up, it was pretty clear it was an annual charge – sure it was in smaller print, but it’s clearly there.
On the page, it clearly says “Billed annually at $47.88″.
Did you ever call them after they explained the terms to you? Personally, I find talking to someone is usually better than email and usually you can explain your point of view.
What ever happened to people taking som personal responsibility. It’s like with credit cards, maybe I don’t read the 50 pages of terms, but I can’t claim it’s a scam when I get a fee on my credit card. We all need to be educated consumers.
Slacker does not trick anyone.The problem is that many people do read the directions or the fine print.On their site they clearly explain how you will be billed.Another problem is that many people do not want to accept personal responsibility when they have made a mistake.They would rather blame someone else.
“Both services allow users to remove those limitations if they pay a yearly fee. Slacker charges $48/year. Pandora charges $36/year for their Pandora One service.”
Pandora One doesn’t give you unlimited skips. That’s the only reason I paid for it, and was dumbfounded they don’t allow it. To be fair, they didn’t say you’d get that, but I assumed so. Arg.
thats really sleezy
I guess this was the easier way for them to get reviewed by TechCrundh!
I somehow like the fact that a company stoops so low to make a few quick bucks but counter-productively gets reviewed by TC. Paves the way for ethical conduct of businesses or face the wrath of TC and it’s commenters.
As much as I hate reading Michael’s bias writing style, I completely agree with this article. What they are doing is illegal and are falsely advertising a payment plan that doesn’t exist.
Although, I’m not sure if it’s a recent amendment but it does say on their main page that it’s $3.99 billed annually at $47.88.
Yes, I see “billed annually at $47.88″ too. It’s directly in line with and only about 20 pixels away from the Add To Cart button, which you have to click to sign up.
@Michael, maybe you should have clicked the Try For Free button to see exactly what information was presented to the user before you wrote this article?
I agree. Cached images on Google show clearly that on the trial page it says “billed annually…”. However, the basic premise of the article is that Slacker is sneaky while Pandora sells their product in clear terms.
Wow, even though I use Slacker’s free service far more than Pandora’s, I’m likely to stop using Slacker after reading this.
+1.
I have never really used slackr (I even misspelt it and won’t bother to correct it). I love Pandora. I don’t listen to music much in general. Sometimes, I just want a specific track and fire up iTunes (or youtube if it is something exotic).
I have not hit the forty hour limit so far. I am glad that there is an option that I can pay just a dollar and continue listening for the rest of the month.
No subscriptions, no commitments.
Oh, and thanks Michael for bringing this to our attention.
Slacker is much better than Pandora. It doesn’t start repeating the same songs over and over and over and over and over like Pandora does.
No excuse for their actions in this specific case, but as a service, it’s better.
I agree. I use the free version on my iPhone. I didn’t know they had a premium version, but now that I know (via this article), I will NOT be upgrading.
Don’t a lot of websites do this? I know match.com, etc do it. So what’s the issue?
That’s a good point. Lots of subscription sites state their terms in a similar way. Some of them even charge you a couple days in advance of the renewal!
Yeah, several web hosting companies also use this method. It’s not that cool to be charging people like that though…
Slacker’s leadership and internal team seems to be living up to their name (hopefully unintentionally). This is going to be a tough lesson learned and hopefully they quickly address this poorly planned approach and offer a humble and careful communication to turn this around.
This is a great example of how NOT to introduce a paid offering and highlights the importance of walking through the end to end process with some trusted outside-the-company individuals who will have a more objective perspective and offer candid feedback.
They can minimize the damage here, if done right.
scumbags! Will never use this service.
Weak sauce, Slacker. I’m sick of sh*t like this.
just threaten to issue a chargeback, and if they don’t give you your money back, call your bank. enjoy knowing that when you get your money back via the chargeback, they also likely get charged a penalty fee.
How about you call them first and ask to get a pro-rated credit? As my granddad said, “honey catches more flies than vinegar.”
After you click “Try for free” it clearly says that the service is $47.88 billed annually.
i was kind of pissed when Bluehost did the same thing. They said their hosting plan was $5.95 per month, but ended up charging me 60 some dollars all at once.
cant we legally take action against such companies?
Can we learn to read?
Oh, Morgan. Of course the company paid a lawyer to tell them they had to put real terms and conditions in there. But the problem is that their marketing copy was done in the spirit of deceit, because they know people skim pages and not read them, and that lot of people will miss that part where it says “billed annually”. And that is no way to treat customers, even if they “can’t read”.
Porn companies use similar shady methods to bill their customers and keep billing them without their knowledge.
Back when I used to develop software at a porn company, we had a period of really bad downtime. I suggested sending out an email to all of the paying customers explaining the downtime and offering a free month. They looked at me like I was crazy and explained that if we did that it would remind a bunch of people to cancel their recurring subscriptions.
After that, I campaigned for and spent most of my time building a pay-per-download no-strings-attached iTunes-like service. It worked great and got good sales, but it unfortunately got shut down right after I left.
Please tell me you are now the manager of something cool at a company that values its customers.
Even better, I’m one of the owners
I also work for a Porn company. Yes we do that, but as Slacker, we specify clearly when we bill that it’s billed annualy (rarely the case, most of our product are monthly based, or even pay per view (which is working great btw, don’t know why your old company shut the service down, bad move)
Yeah that’s pretty shitty. Billing annually is fine, if you’re up front about it. If you say your service is $4 per month then charge someone $48 up front for a year, your company sucks ass.
American Express has a pretty good dispute team. That said, it seems that a lot of service companies avoid taking AMEX for that reason.
It that’s true, then that seems like a good way to figure out which companies to avoid, since if they provide decent customer service they shouldn’t have any problems with billing disputes!
(On a side note, I think AMEX charges slightly more per transaction and that probably has more to do with it than the dispute team.)
this is weird. Don’t companies understand that purposely misleading your customers is BAD for your bottom line. It’s all about enlightened self interest…
Ok I definately noticed this when I did the free trial but I read a little into the TOS and knew it was 48 dollars all along. This isn’t Slacker’s real scam. Slacker’s real scam is that they claim to offer unlimited skips and it actually cycles to the same songs over and over again if you skip too much. I never bothered blocking all the songs to see what would happen though, I decided to move onto Pandora instead shortly after.
Even though both companies are businesses trying to make money, Pandora seems more in touch with their community and Slacker feels a bit less in touch with their users imo
It’s also a wonky service. I paid the $7.99 or $3.99 or whatever, but I’ll log in and stuff won’t work. I can’t sink stuff to my player. It won’t recognize the player. You’ll push buttons and they won’t work. Try to open IE or FF or Chrome and some buttons work and some don’t. Can’t figure out what’s going on over there.
Slacker as a company is shady. I was in a business deal with them on the vendor side and the tactics they used were so completely unprofessional.
This article doesn’t surprise me at all. It’s the culture there.
I think their name speaks volumes.
nice one.
Pandora was always better than Slacker anyway. This should make the choice for everyone that much easier.
If this Vickers guy has to pay for premium service just to skip more songs, then he shouldn’t be using these services at all. Granted Pandora might get annoying but Slacker, come on!. With slacker, you have the opportunity to fine tune your music to the point where probably only the song you would like to hear. From fine tuning the artists, the popularity of the songs, and how deep you would like it discover new musicians that fit your ears. I don’t think I have ever skip more than 1 song since i have been using the service.
In one custom station, I choose 6 artists and let the fine tune discover only some (not max) similar artists. I can even choose certain songs from my artists so that it know my taste. Since the first time I customized, it has only played good music to my ear. Frankly, people should be open minded about the free music they get, even if you decide to thumb dumb (or but it on shelves) a song, there is no excuse you would do that more than 6 times an hour, it just mean you only like that one artist and won’t give anything else a try.
As for the ad, I use the service for the sounds not the visuals. Banner is avoided since it is in the background. And those 10-20s radio ad is not annoying, especially when compared to real FM radio.
Eh misleading info can get more sales.
Advertising a subscription price by the monthly price and charging the annual price is a common practice. However, most sites make it do with something like “$3.99/month billed annually”.
What these people are doing is robbery.
Last sentence = false.
On the next page, well before you give them any payment information, or any personal information at all, it says Billed annually at $47/year.
Learn how to read, idiots.
Or we can whine about Toyota offering Corolla’s at only $199/month, or magazine subscriptions at 99 cents per issue.
Not saying that makes it okay, but I’ve seen this type of thing so many times over the years that I tend to check payment terms for web services ferociously whenever I sign up for something.
Yeah the Jamster bait and switch ringtone model.
Slacker is desperate, as is many music based startups that are not iTunes.
Again, I warn, stay away from money pit music startups.
I subscribed to Slacker Premium a couple of months ago and remember seeing a note that the subscription would be billed annually prior to me giving them my payment information.
Sure, it would’ve been nice for them to spell this our clearer on their home page, but it was made quite clear during the signup process.
Plus, tons of other online services do this. They bring you in with a cheap looking price on the homepage and then later tell you that you only get that price when pre-paying for a period of time. Maybe it’s not the up-front practice, but it’s not exactly misleading or robbery either.
thanks for the alert. Just switched to Pandora (though I am just a free user). Left a message with Slacker support telling them about my decision.
thanks mike for using the bully pulpit to expose this stuff. i hate weaselly stuff like this and TC is one of the few blogs that has the power to expose it. i suspect this policy will be changed pretty quick.
guys, seriously?
i’ve been using slacker for a few months and have been considering an upgrade, and it has been clearly disclosed (yes, in smaller font) that they bill for the entire year in one shot.
further, has anyone actually entered the name of an artist simultaneously in pandora and slacker to compare the radio stations they create? every time i do this, slacker gives a much better selection.
My recommendation would be to bill customers per decade; just hit them for the full $478.80 and also add a $8 convenience charge. Also, try to get SpaceLocker to help with your viral campaign.
Sarcasm….
Doostang does a similar thing with recurring subscriptions. They sell “1 month for $X, 3 months for $Y” and then adds a small line of text saying they’ll bill your repeatedly on the confirmation screen.
1. Before you can even add the “Try it for Free” item into your shopping card… It says its billed ANNUALLY. So all this crap about “lets sue them for false advertising” is a load of bull. It’s impossible to even “purchase” the 7 day free trial without seeing the “billed annually at $47.88″ RIGHT NEXT TO THE “Add to Card” button.
2. Slacker is great if you have a Blackberry. Not only does it sync up with your desktop. It even caches tons of stations (to your memory card) on your Blackberry. This is the reason why I purchased the plus account is because of the Blackberry integration.
3. And this junk about “I try skipping songs and it just skips to the same song” is something that in over a year of using the program has NEVER happened to me. (And at times I’d skip through 25 songs at a time… no repeats.) Plus the more I customize my stations, the more my favorite songs cycle through the playlist.
The whole concept of blaming Slacker for being sleazy is just a Techcrunch writer trying to stir up trouble. It says right up front AND before you can even create an account with them that they bill at an Annual rate.
Everything else is just a bunch of whiners looking to stroke their pandora crush.
I’m not affiliate in any way with Slacker other than just using their software on my Blackberry.
Totally agree, it’s not a scam. I signed up for the trial and ended up keeping the service. Yeah it says 3.99 at first and is a bit misleading, but it clearly states that it is billed annually on the account compare screen under the button that says “Get Plus.” It’s not even in fine print. Maybe we should sensationalize all those help a starving child in 3rd world country organizations for telling me it would only cost as much as a cup of coffee a day. I can’t believe they charged me all at once!
hmm It clearly states billed annually.
How is it decieving?
Pretty clear to me.
techcrunch being techcrunch
I don’t think it’s robbery or that it they can be sued or anything like that. However, it is misleading – when you have a giant “$3.99 per month” sign and no asterisk or “billed annually” after it. I’m sure plenty of people would be surprised to see a $48 charge come through. I’d definitely cancel through my credit cards – they are usually very helpful about stuff like this, especially if you demonstrate that there were misleading terms.
Dear Fellow Cyber Information Superhighway Users:
I made a Long Distance from my home in Arlington, VA to Chicago, IL. The cost was only 12 cents per minute. I wanted to ask about how to use the calendar function on my new PDA to plan out my days. They told me that I can Download the instructions from the World Wide Web. Wow, what technology. I asked the typist at work if we have the World Wide Web at our company. She said, no, but we have something very advanced called the Intranet. She proceeded to use the Personal Computer to send a CC Mail to someone for advice. He said that he does have access to the Information Super Highway at his home, and that he would go home and Dailup a connection, at which time he would Download the manual for my PDA. This is just incredible. He even says he Surfs the Web all the time.
Sincerely,
/electronically signed/
Prince Momar
PS, would anyone like to become Penpals with me via Telnet or IRC (Internet Chat Relay)?
Pandora actually doesn’t allow removing the number of song skip limitations with their premium accounts – the biggest advantage that Slacker Premium has over Pandora One. Though its definitely shady if they don’t offer partial refunds and misleading marketing script.
Had the same thing happen at IGN Insider…very lame.
http://thecakes...n-insider-fail/
Theres better FREE services out there
Wow, all these peopel are going to stop using Slacker because they want to bill you annualy? Are you serious? You are using their product for free and you have not bought anything but yet you are going to whine like a bunch of little kids. 1 month ago I was going to sign up for the Premium but it cleary stated when I click Sign Up, that my account will be billed annually, so I did not sign up, YET. Give me a break people, a lot of companies do this, so for you all saying these are shady practices it is not. I am also upset that TC put out this article without putting in all the details that it does CLEARLY state the annual billing before you submit your order. SHAME ON YOU TC.
Slacker is much better than Pandora, it is much faster on 3G for my iphone.
No Shame on you!!!
Slacker is dishonest. Simple as that.
Marketing copy is fine. Cancellations, however, should be honored.
Better Google Trends graph showing the difference here – http://trends.g...er.com&sa=N
I have no problems with Slacker, I paid the money for a year because unlike Pandora they offer unlimited skipping, with Pandora they don’t say you get unlimited skipping and I don’t think you do. Slacker does say they will bill you for a full year and IMO it’s worth it, at least for me, I’m streaming music all day at work between slacker, Pandora, and Sirius.
Slacker has a great online product, but my experience with their customer service and purchase of their physical music player was been horrendous!
It was not until AFTER I purchased the player for several hundred dollars that I discovered if I wanted to sync the player to my computer via USB, that I would have to reconfigure the broadband Internet settings that would affect my entire household!
Nothing doing, I told Slacker. It was a pain in the ass to return the product and get a refund — they make the customer jump through lots of hoops — but I did finally get my refund.
I will never ever do business with Slacker again! It was a very stressful experience dealing with them.
I ended up getting a tremendous deal on eBay for a brand-new 120GB Zune and create my own playlists for less than $15.00 per month for all the music, comedy, podcasts, and vodcasts that I have time to listen to or watch! Very happy camper now.
+1 on ‘learn to read’.
I bet this Josh also took out a mortgage without reading the terms, and then later claimed the mortgage broker ’scammed’ him as well.
pathetic
disclaimer: i use slacker’s free service and love it.
This smells of the porn industry. Its almost like the founders were once porn webmasters and they simply like ripping people off hoping they dont cancel the order.
The best thing is to report fraud to your credit card company and get a nifty refund.
Where I come from we would say “what a bunch of kooks” (Santa Cruz, CA.). Maybe other people would simply call them “jerks”.
Love ya!
It says plain as day that it’s billed annually if you don’t cancel the trial within the 7 days. People who don’t read are now victims of a scam?
Unbelieveable. The price is 3.99 a month billed annually. If you actually signed up for it, you saw it or you weren’t looking at all. I signed up for a year and knew what I was getting into before I pressed the accept button. Why didn’t you?
Nowhere does it say billed monthly. Why would you naturally assume it was?
They aren’t sleazy. You can’t read and want to blame someone else for your problems.