Shutterstock to Pay $35M to Settle FTC Allegations Over Deceptive Subscription

Shutterstock Inc will pay $35 million to settle allegations by the Federal Trade Commission (FTC) that the online photo and video platform generated tens of millions of dollars through unfair and deceptive practices, including charging consumers without their informed consent and making it difficult to cancel subscriptions, according to an FTC release.

“Subscription and negative option features can be beneficial for both companies and consumers, making renewal simpler and streamlining payment processes,” said Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection.

“But these benefits depend critically on firms clearly disclosing material terms, securing express and informed consent before charging consumers, and ensuring cancellation is straightforward and simple. When firms fail to follow these principles, they deprive consumers of the ability to make informed choices, undermining consumer sovereignty and impeding competition. The Commission’s action today underscores its commitment to preserving consumer choice and facilitating competition in digital markets and subscriptions.”

New York-based Shutterstock licenses stock photos, graphics, videos and music clips that customers can pay to use. Since at least 2020, the company has offered most of its content through online subscriptions, which allow users to download a specified number of assets per month and retain a licence for a set period.

According to the FTC, consumers subscribe to Shutterstock products online either via the company’s website or through advertisements that direct users to specific plans. The company offers several licensing options, including annual paid-up-front (APU) and annual paid monthly (APM) subscriptions, as well as on-demand “packs”. The Commission alleged that Shutterstock failed to disclose key information about the terms of these plans.

The agency’s complaint stated that Shutterstock marketed its on-demand packs as “best for a one-time project” with “no commitment”, but did not adequately disclose that the packs automatically renewed once the final download was used and, until early 2024, also renewed after one year.

It further alleged that the “plan selection” page in Shutterstock’s desktop APM sign-up process often failed to clearly disclose key terms, including automatic annual renewal and early cancellation fees. According to the complaint, such details were frequently buried in fine print that was difficult for consumers to locate.

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