18 ms·

I analyzed SaaS billing dark patterns

204 points by indus 5y ago

heavyset_go 5y ago
The dark pattern I like the least is the one where providers do not let you set a limit or budget for charges to your account per billing period. For example, I've yet to find a cloud provider that lets you, say, put a $200 a month spending limit on your account. The best we get is a notification system.
- rovr138 5y ago
  Imagine the issues on something like AWS, Google Cloud, Digital Ocean, Rackspace, etc. Imagine if a company sets a limit. One that allows for burst and growth. Then they forget to update it, and then one day, all their servers, data and everything else is gone. Even if things are offline, they accrue costs, so the only thing to do when a limit is reached is destroy everything. What’s the balance?
  - heavyset_go 5y ago
    > Then they forget to update it, and then one day, all their servers, data and everything else is gone. Even if things are offline, they accrue costs, so the only thing to do when a limit is reached is destroy everything. That's not the only thing you can do. It takes quite a while from non-payment for OVH to take down their clients' services and delete their data, for example. They give customers a month long grace period before taking their service offline, and then there's another waiting period before they delete the data. At any point clients can resume service with payment.
  - ahtihn 5y ago
    It should be trivial for the provider to compute the cost of offline resources and account for it when triggering the limit to give a few days to react before destroying everything.
  - joshmanders 5y ago
    I'm implementing this in my cloud hosting platform (https://primcloud.com https://primcloud.com) and how we plan to do it is email triggers when certain thresholds are met, and if no action is taken, give a grace period before taking stuff offline. Yes they will be charged for that grace period, but setting a limit of $200 and being charged $250 sure beats getting a random $1,000 charge.
    - rovr138 5y ago
      Definitely. Maybe a % with minimum time and a max on money.
      - indus 5y ago
        This is tricky. We have alerts from AWS for monthly threshold, but most of the time it is ignored until the $$$ becomes large enough for the Engineerin Manager to get worried.
teekert 5y ago
I really like Digital Ocean and Linode in this respect, I can spin up a server, play all night, destroy it and it cost me cents. It's easy to see what't still running and monthly emails (payed per minute) remind you if you still have things running. I never had any surprises. But then again, I am the VM kind of guy, not the hyperscaler type.
brooklinnash 5y ago
"Our research shows that companies underutilize their SaaS products by an average of 30% across the board" Big yikes. I'm curious which of these approaches would have the biggest impact on bringing that SaaS waste down.
- indus 5y ago
  Though not easy to implement, but consumption driven billing rather than seat/user-driven would reduce the grief quite a bit. In the early days AWS EC2 became popular for their per compute per hour pricing compared to hosting providers fixed monthly cost.
cosmolev 5y ago
Subscription-based software is already a dark pattern.
- wbobeirne 5y ago
  What would you recommend products that host the service and have ongoing upkeep costs to do?
  - newfonewhodis 5y ago
    I would recommend the creators ask themselves if their software _really_ needs to be hosted or can it be sold as a one-off (self-host or desktop/mobile).
    - Veuxdo 5y ago
      Seems orthogonal. You can have subscription-based desktop/self-hosted, and one-time-payment hosted software.
    - mdasen 5y ago
      I don't think you should be downvoted for this, but I do think there are some reasonable responses to it. First, supporting desktop/mobile software can be hard. Customers have all sorts of weird things on their machines. iOS cuts down on that, but you still lack access for a lot of debugging and that can cost a lot of money. Support is expensive. Second, I think there's this idea that desktop/mobile software is a one-off. What happens when Apple removes an API that your program used? Do you tell uses "sorry, your $X doesn't entitle you to a working program anymore?" For better or worse, software requires ongoing investment. If software requires ongoing investment, it kinda requires ongoing payment - or operating on the idea that new users will pay for the improvements required by older users. However, that's a dangerous assumption. At some point, there are a lot more older users than there are new users. Many companies tried to operate pension schemes assuming that new workers would pay for older workers retirement benefits. At some point, there are fewer new workers than there are old workers and it collapses. Software maintenance is important, but it can be hard to price. Do you tell users "you have a license for 2.0, but you'll need to pay $X to upgrade to 3.0...oh, and 2.0 won't be updated to support iOS 14 so you're basically forced to upgrade"? Do we tell creators "if you don't keep this software maintained in pristine condition for the next 20 years, you're being predatory"? That kinda just demands that they do uncompensated work. Even if software isn't hosted, there are ongoing costs. Some of that can be priced into the initial purchase of the software. Some of it can't be. It's hard to guarantee that software will continue working for 2, 5, 10, 20 years when you have no idea what that might entail in terms of work. 20 years ago, Apple was shipping Mac OS 9. Since then, I may have needed to upgrade my app from Classic to Carbon, from Carbon to Cocoa, from 32-bit to 64-bit, from PowerPC to Intel, and now from Intel to ARM - not to mention the huge number of APIs that have been broken along the way. Is the right model something like what JetBrains does where you get a perpetual license to the version you bought, but that version might just stop working given changes around it (like OS upgrades or new machines it isn't compatible with)? That doesn't force you to subscribe, but it does mean that you're likely going to need to upgrade. Programming languages move on and you're stuck with an IDE highlighting things as bugs or that won't launch your program because it isn't compatible. Subscription-based pricing gives creators an incentive to keep investing in their program and it gives customers predictable costs. No one wants to hear "sorry, this won't run on M1 and we're not going to upgrade it for free for you so here's a $X charge that you have no way around given that Apple is abandoning Intel".
hdjjhhvvhga 5y ago
> Free trials should not require a credit card. Collecting your payment information is an obvious red flag that you will be billed as soon as the free trial period ends. I remember many people on HN defending this pattern saying that they are not interested in people who don't want to provide their CC details, that they are bad customers, they just want a free ride, and they are not sorry for setting it up like this. Oh well. I guess with time more people get burned and will finally learn the hard way this is just one of many grey patterns.
- rhizome 5y ago
  This is exactly right. For years it was conventional business wisdom and best practice to focus on getting the CC. We could probably find some pretty embarrassing (for the web industry) threads if we wanted to look.
- human 5y ago
  Requiring a credit card for a trial is fine, as long as you don’t convert automatically to a paying membership. And if you do, please send me a reminder a week before at least.
  - dhimes 5y ago
    I'll add: A reminder with an opt-out link.
- rapind 5y ago
  How is this a dark or “grey“ pattern. Are they being sneaky about it? At most it could be a signal that a business intends to be a douche, but that’s only because douchey companies ruined it. Just like duchey free customers ruined that for everyone. My employer probably thinks payroll is a “grey” pattern by this logic.
  - mitchdoogle 5y ago
    It's a dark pattern because they claim the trial is free, but ask for a credit card. They are betting on the user forgetting to cancel, or worse, actually make it difficult to cancel. If it was just about giving the user a chance to try a product, they wouldn't need to collect credit card information. Some people claim it helps to prevent abuse. Maybe, but there are other, user-friendly ways to prevent abuse.
human 5y ago
I’m not sure it qualifies as a dark pattern, but I was really frustrated by the Logmein pricing. I was paying a relatively expensive amount for my 100 computers package. Once I went over that threshold I had to convert to the 500 computers package which cost 4x was I was paying. That was true even if I had 101 computers and not 499. I ended up upgrading with a negotiated price but still don’t understand why it’s not a price per computer.
- rhizome 5y ago
  Easier bookkeeping on their part.
  - elliekelly 5y ago
    That might be the reason for the different tiers but there is definitely a dark pattern in the auto-upgrade GP describes. LogMeIn could just as easily put a hard stop at 100 computers with a notification the user needs to upgrade to a higher tier package. Instead they auto-upgrade the user without asking. (I’m assuming there’s no way to avoid the auto-upgrade. It’s one thing if a user opts in to the tier scaling for their own convenience I think that’s different.)
    - human 5y ago
      In their defense, I wasn’t auto-upgraded. I just couldn’t add computers anymore. I hovered around 99 for a while, removing old computers, but one day I had to open up my wallet.
  - indus 5y ago
    Easier bookkeeping is the main ingredient of debate between consumption-based billing (AWS, Twilio, etc) vs user-based billing.
- indus 5y ago
  Not having consumption-based billing is definitely a callout issue and many exploit the simplicity of bundled t-shirt (Small, Medium, Large) SaaS pricing.
elias94 5y ago
I forgot the AWS password once for an account with only one S3 bucket. I did the recovery procedure but they wanted to verify my identity using my document. I send them my ID, which was with a different address from my account information. They didn't accept my ID and I wasn't able to stop the service and the recurring payment. Fortunately I registered my payment with a prepaid credit card, so was easy to empty the card and let them billing into the void. Since then, I always use a prepaid card for recurring payment. It saved my ass in a way. One of the largest dark pattern is also having a poor customer service.
- r00fus 5y ago
  Is failure to pay (ie, card authorization) good enough for inability to cancel? Couldn't they just invoice you and hold you liable for fees regardless?
  - indus 5y ago
    A failed card auth does not remove the obligation to pay. Most vendors write if off, and don't follow-up after a few emails. Plus, they don't want users to get pissed off and post a negative review. Many vendors have now optimized their billing flow to reduce write-offs. They start charging on the first of the month for the upcoming use, and then cancel the account if the auth continues to fail.
    - inetknght 5y ago
      > A failed card auth does not remove the obligation to pay. Let them sue over it. They'll just love how the courts would rule in favor of a customer who clearly tried to recover their account in good faith and tried to cancel the billing in good faith and, failing both, canceled the billing in the only remaining way since the company provides literally zero customer-friendly options.
      - indus 5y ago
        Definitely the customer has a case if there is an intent to cancel the service. But, just ignoring based on a failed auth may not shift the liability. Infact, when disputing such charges with the issuer, the customer always wins if there was an attempt to cancel the service.
digitalengineer 5y ago
Hubspot. The yearly plan is way cheaper. But you need to cancel it 3 months in advance or you’re on the hook for ‘the same period’, thus another year. No reminder email of course.
- indus 5y ago
  applicable to a majority of annual contracts of top SaaS vendors.
- rsstack 5y ago
  FullStory sent us a reminder email last week that we need to cancel 2 months before the annual contract ends. I started a Slack thread, we all agreed we love FullStory, done. I think SaaS that try to trick their customers by not reminding them about their cancellation policy (which isn't consistently 1 month, 2 months, or anything, and is hard to track when you're a small startup) are just afraid their product isn't good enough or valuable enough for people to renew. Instead of improving their product, some exec can say "let's not remind them", and get about the same rate of retention.
notyourday 5y ago
> Free trials should not require a credit card. I'm not in business to provide services to people who want stuff for free permanently. They complain on forums, raise stink and spend nearly no money. They are not my customers. I always ask for a credit card for a free trial. The fewer non-customers signup, the better it is for me.
- lgl 5y ago
  While I kind of understand your point of view and not all businesses are equal, a free trial is not stuff for free permanently. You should be confident that your product will be able to make the customer willingly add their credit card after their trial is over if you are indeed providing them with a useful service.
  - not1ofU 5y ago
    I agree, and was going to posit the same argument, however, a credit card is a useful way to get unique info. If someone signs up to free trail without something like a CC, instead using an email address, then they just have to register a new email address to get further free service. Although I am sure there are alternatives that I havent considered.
- brooklinnash 5y ago
  What's your thought on alternatives, like Ahrefs' $7 for 7 days trial?
  - notyourday 5y ago
    Unrestricted service at the highest plan level, 1 to 2 weeks, credit card not only required but is authorized for the plan price - do not settle transaction as it is still a free trial. This ensures: 1. Whoever tries the service at least theoretically met minimum qualification to be a customer - they have a credit card and can authorize several hundred dollars on it. 2. We get the real lead. 3. We limit the number of people who recycle free trials -- this happens a lot.
atgarone 5y ago
I got locked into a reseller agreement with JustHost for my wife's GSuite account, which she uses for her full-time work. Now I'm paying them $90 a year just so I can retain my GSuite services without her having any downtime or losing her data. Only recently did I discover GSuite has an FAQ for getting out of reseller agreements. Going to have to act on that.
jmsuth 5y ago
This is one of my biggest qualms with building SaaS apps on the App Store. You can't do a free trial without requiring an Apple Pay confirmation which will auto-convert. We get lots of negative reviews because of it, but there's no way around it without offering some free version.
- indus 5y ago
  Though apple pay does a decent job on the cancelation UI, the free-to-paid notifications (in email) are always a miss. I have seen this in trial subscriptions at home with buyer's remorse later.
CPLX 5y ago
These are far from the worst patterns. I've seen so much awfulness out there. My favorite recent one was a renewal if you don't cancel by a deadline that's months ahead of the actual end of the contract period and it also had a substantial rate increase and all the language that we supposedly agreed to wasn't actually present in the contract we signed. Those terms were in one of those "incorporate by reference" clauses where it says this contract incorporates terms and conditions that are at the following URL and it's 45 pages into the fine print of that URL. I mean supposedly, since it's their URL and could just change the terms whenever they want and lie about it. Which by the way wasn't clickable in the Docusign. Basically it was in an unlit basement behind a sign that said beware of the leopard. It's not ethical. It's just exhausting to deal with some of these companies. I think we all know who they are, they tend to be concentrated in the field of SaaS companies that cater to the sales and marketing functions. Lately I've had what I've found to be a fairly clever solution however. We wrote up a standard document that contains our terms and conditions for SaaS providers. The key clauses basically say "We hereby give formal notice that we do not consent to any automatic term renewals, any automatic price increases, any charges to credit cards made 'on account' without our specific consent as to the date and amount charged. To the extent our agreement requires advance written notice of any of the above this letter serves as that notice." and so on. Then we send it certified mail to the company's corporate HQ address and keep the tracking number. We do this on the same day we sign any software contract, it's basically an automated process at this point. So whenever it comes around, and it has, we just say sorry we've already given formal written notice we don't consent to that. Here's a scan of the document and the USPS receipt maybe work on your internal communications. The fact that we have to do this is apalling but hey it's better than the alternative.
- Plasmoid 5y ago
  Does it actually work? Have you tested in in court?
  - CPLX 5y ago
    Haven't made it to court but it would certainly be legally sound. Courts love certified mail and formal notices it's not even clear what counterargument they could have. They require notice, and we gave notice and can prove it. But in real life what it really does it get them to back off and go back to having a normal negotiation about what we do want to do for renewal instead of the bullshit attempt to mislead and trap us. Needless to say if there's any viable alternatives to companies that do this we take them but in some categories all the options suck.
encoderer 5y ago
Of all the nasty things somebody can do with billing, I'm surprised the author leads with card-upfront trials. "Free trials should not require a credit card." This is opinion presented as fact. This is not a dark pattern. Totally unrestricted free trials are wonderful, you've invested a ton in your product and you want a prospective customer to experience everything. But there are legions of abusers and bad actors of all kinds. Having an opt-in to use/abuse your platform for 2 weeks is not always viable. Card up front is not a perfect filter, but it's helpful in turning this noise way down and letting you focus on helping actual prospective customers become successful with your product.
- atgarone 5y ago
  I'm sure that when you're analyzing SaaS transactions for a year (full time), you see a lot more data than we more-select-few-who-can-discern do.
  - dinobones 5y ago
    You forget this is HN, where software engineers will go off on tangent talking about how "they could have designed the airplane rotor to not crash" or something equally ridiculous. Everyone here is an expert at everything, because they wrote a blog once, or since Paul Graham is perceived to be an expert on everything, they can be too.
    - indus 5y ago
      > since Paul Graham is perceived to be an expert on everything, they can be too. ROFL.
    - perl4ever 5y ago
      As you know, Bob, they let anybody on here regardless of occupation or knowledge of Phil Graham. So some random commenter could perfectly well be an aerospace engineer. Or someone that's never been employed in their whole life.
    - deleted 5y ago
      [deleted]
schnebbau 5y ago
> Your company needs a CRM, so you sign a year-long contract for, say, 50 seats on your chosen SaaS CRM. Then — yikes! After six months, half your team is laid off. Will the CRM let you adjust and pay for 25 seats for the remainder of their contract? > That’s a big NO. Unused seats? Still gotta pay for ‘em. (It’s called “SaaS waste” for a reason.) You committed to paying for 50 seats for a year. The CRM may have made decisions based on that commitment, such as hiring people, or themselves committing to bigger plans with their providers. Why should they get screwed because you choked? Don't commit to long fixed periods if there is any doubt you won't make it.
- hermes8329 5y ago
  Saas has obscene markups
  - ZephyrBlu 5y ago
    It has "obscene markups" based on costs, but that is not how SaaS is priced. It's priced on value.
- awillen 5y ago
  In general I don't think it's fair to describe anything as a dark pattern this is clearly communicated in a contract. Same with "Here’s a similar problem with a different scenario: You sign a one-year contract with a SaaS provider. You start paying immediately. The process to get API access, build integrations, set up the software, and onboard and train your team takes three months. In those three months, you still paid for a service you couldn’t use yet. In fact, you had to pay to set it up! You had to pay upfront to get the functionality you needed." Do I generally think that's a bad policy? Sure (depending on whether there are significant resources required on the software company's side for you to build your integration). If you're told this is going to be the case and agree to it, is it a dark pattern? Clearly not.
  - CPLX 5y ago
    That’s not really a fair way to evaluate contracts for fairness and ethical conduct. Not only does the contract have the obligation to be clear (and let’s be blunt the people that do this are often not trying to be clear about what they are doing) it also needs to meet basic standards of reasonableness. Specifically, to the extent that a contract diverges sharply from the general understanding each party has about how the world works, the more the drafting party has an obligation to clearly call out the terms in a manner commensurate with the importance of the contract term. Legal documents aren’t software code, it’s a classic mental error developers make when discussing them. They are evaluated by humans. For example, it would not be reasonable to have a single sentence buried in the middle of a 20 page SaaS contract that obligated you to purchase cat food, or signed away the rights to your apartment. Wouldn’t matter how plainly worded the sentence was and if it was duly signed. You’d still have to convince a judge that was a reasonable thing to do. Good luck with that. And regardless of legality it’s obviously not ethical it’s a trick, intended to be deceptive. Obviously there’s subtlety to this and the exact details matter. But that’s my point. You can’t just fall back on the idea that anything you get someone to agree to isn’t a dark pattern. The whole point of dark patterns as a concept is that you’re tricking people into agreeing to unreasonable things.
lordnacho 5y ago
Is anything being done about this kind of thing? It's one of those steal-a-dollar from 1M people tricks. If you stole 1M from one person they'd do something about it. Pick 1M pockets and nobody can do anything.
- indus 5y ago
  there are a few ideas, to let technology help. Others are around legislation, such as the one that came yesterday from FTC on call to cancel being illegal.
tie_ 5y ago
Here in Germany, physical businesses have even more egregious subscription policies than most "dark" SaaS-es. Think, you do not cancel 3 months before expiration date - congrats, you're now signed up for another year. As a result, ended up writing a small PWA to keep track of my contracts and subscriptions.
- indus 5y ago
  Whaat! This one is new. You mean subscriptions from your neighborhood store such as milk, bread, newspapers, etc?
  - niklasd 5y ago
    Newspapers, fitness studios, mobile providers, railway discount ticket (Bahncard). Can't say for neighborhood stores, I haven't really used a subscription at such a shop.
  - tie_ 5y ago
    More like gym, "clubs" (Verein-s), mobile phone, internet, electricity, etc. It's an established contractual practice, and e.g. Telekom are not in any way obligated to notify you when your cancellation date approaches. They can very well sue you, however, should you refuse to pay your automatically-renewed-in-advance contract. Even in the cases where you're allowed to cancel on the last day of the subscription, we as humans are very prone to forget to do that, particularly for longer-term contracts. Tracking contracts and subscription deadlines is a damn profitable habit that I wish I had acquired much earlier.
    - indus 5y ago
      Curious: if they sue, then the only damage is money they owe or there is more to it such as credit history, etc?
      - tie_ 5y ago
        I haven't really tested it in court, though I did get the official correspondence that leads up to it. Friendly law practitioner had suggested that I really don't stand a chance. Not sure about credit damage, but in case of a loss in such a suit, I'd also have to cover the expenses for the other side, so it's a risky proposition. With my wife we did consider it for a while, but then decided it's better to do focus on solving that problem with software and thus started working on contrax.app (shameless plug!).
bazhova 5y ago
AWS costs are somehow always higher than your estimate. Even when using their little calculator. That's the dark pattern right there.
- HatchedLake721 5y ago
  Emmm, no? You can download detailed billing and drill down if you want. If you see differences, one reason is that with hourly billing your monthly bills will be different, depending whether it’s a 28, 30 or 31 day month.
  - justin_oaks 5y ago
    I've been with AWS for a number of years (personal and for work) and haven't seen this problem either. Some services will be higher if you don't account for all the costs. You can do the math for an EC2 instance but if you don't account for storage prices and bandwidth prices then the bill will be higher than you expect. But some service prices will be lower than you expect. If you create multiple EBS snapshots from the same server, you'll notice that the price you pay isn't the sum of the individual snapshot sizes. It's far less because each new snapshot only saves data from blocks that have changed since the last snapshot.
  - tyingq 5y ago
    For people just starting, I can see it being true. A pedestrian example might be a Lambda. You look at the pricing on their site and calculate it down to the penny, but the cost ends up higher. Because the Lambda pricing page doesn't mention the Cloudwatch logs that were created with your Lambda, but they aren't free. (Leaving free tier stuff out of the picture).
jedberg 5y ago
This is a very cynical take. Not all of these things are designed to trick you. For example, requiring a credit card for a free trial is to prevent free trial abuse. A normal person can only get so many valid credit card numbers, assuming you can detect burner cards (which for the most part the CC companies will happily help you do). Yes, a good company will notify you that a trial is going paid, and a great company will require an affirmative action on your part, but the main goal isn't to trick you and hope you forget. Also, the part about not prorating costs if you use less resources. Usually you get a discount for paying up front. The reason you get a discount is because it allows the company to do more efficient resource planning, a savings they pass on to you. If they allowed you to cut back, you haven't upheld your part of the deal. A big company can absorb the loss, but a small one can't. Yes, some companies do these are dark patterns to increase their profits. But most have some pretty good non-nefarious reasons to act like they do.
- moneywoes 5y ago
  Does Stripe detect something like privacy.com?
  - paulryanrogers 5y ago
    They probably have their own BIN/IIN. So it may be trivial. Still privacy.com per merchant cards are more likely to be actionable than stolen or prepaid cards.
  - jedberg 5y ago
    They might, but also privacy.com will not let you get more than two cards per site without a special exemption. I learned this when I tried using multiple cards for AWS, one for each app. They wouldn't let me do it. So maybe Stripe knows which burner providers have their own restrictions and treat them differently?
  - parkerhiggins 5y ago
    Stripe Radar can be configured to provide signals that would reflect a virtual card, but not explicitly. Further trying to solve preventing virtual cards use potentially introduces false flags. Requiring 3D secure may. Depending on the product and audience, the prevalence of virtual cards may be extremely low. Outside of hackernews, the payments industry, and business cards nobody uses virtual cards like privacy.com
saahilsaini 5y ago
as a new entrepreneur trying to understand saas expenditures this was an insightful read into the industry
wly_cdgr 5y ago
Without reading too much into the fact, it's still pretty funny that this is marketing for a SaaS product
magicalhippo 5y ago
> Companies waste tens of thousands of dollars every year on SaaS products they subscribe to but don’t use. And when I say “don’t use,” I literally mean zero logins for paid users during a subscription period. We have a SaaS product, and we see that as well. Usually our sales folks will have a look every now and then and see if there's a lack of activity. Almost always it's the result of someone quitting or losing their job, and our software gets lost in the handover of responsibilities. I've heard of several cases where sales has effectively re-sold our software more than 3-4 times to the same division in a company over the years.
jscheel 5y ago
I'm quite a bit leery of this article, even though some of it is pretty accurate. There are some glaring problems with it, and I would advise you not to take it as gospel truth. First, requiring a credit card for free trials is often necessary to weed out bad actors. Second, the author spends an awful lot of time complaining about being held to the terms of a contract that you willfully signed. I get that renegotiating a contract is nice to do for your customers, but it's a contract for a reason. Usually, when you signed up for that annual plan that you suddenly want out of, you were given a discounted rate by going annual. I notice that the author never mentions this when suggesting that companies are bad for holding up the terms of a contract. Finally keep in mind that this article is a marketing piece written by a saas product for rolling up saas payments.
petercooper 5y ago
I really appreciate how Slack handles things by scaling down your payment month by month based on how many users are actually using the service. I wish more SaaS providers, especially big ones with the capacity to develop the feature, would do this rather than lean on people or companies forgetting to remove seats.
- indus 5y ago
  Slack is the gold standard. I reached out to a Senior Product person at a very large SaaS vendor on auto-scaling the seats -- based on simple monthly active. His response: "Our Sales team would never let that happen."
SavantIdiot 5y ago
Forgetting to kill your cloud instances and getting charged isn't a dark pattern, no more than forgetting to fill your gas tank isn't an automotive manufacturing dark pattern, or leaving your water running in the basement sink and forgetting all winter and then having a fight with your husband just before Christmas because the water bill is $1000 and you're the only one that uses the basement utility sink but only in the summer because it is too cold in the winter...
- scrose 5y ago
  Forgetting to shut down an instance in the cloud is the least worrying problem. In AWS, everything has a price. And some things don’t have a price until they’re the only thing left(ie. Elastic IPs that only charge once they are not assigned to an instance). For someone new to AWS and testing things out, a closer analogy would be like moving into a new house and trying to find out which pipes are leaking
- phist_mcgee 5y ago
  I would say it's dark because the platform does not usually place any emphsasis in letting you know it's still there or not. There are no built in safety rails (like a check fuel light) that can help. These platforms are designed to be obtuse.
  - danpalmer 5y ago
    I'd challenge these being "obtuse", I think it's more likely that they are designing for a different type of customer. As an engineer working on a production system, everything in code, etc, I don't really want an alert saying "Are you sure you still want to be running your database?". This isn't really a feature that most production systems need. What I'd like to see is features for experimental work – being able to mark an AWS account, or org, or maybe individual services/resources, as "experimental" and have it auto shut off after some reasonable amount of time, with clear warnings during use (as much as possible) that this is an unsupported experimental service. Hell, if the time limit/capacity limit was low enough, I feel like these could be a permanent free plan with cloud providers. The question is: are these customers worth designing features for? I could see why they might not be, although I think it would be beneficial to the industry.
jpomykala 5y ago
“Free trials should not require a credit card.” I have a small project where I allow people to auto-translate their web and mobile applications. I’m using Google Translate and DeepL for translating texts from language to another. DeepL charges me $20 for every 500k translated characters. What I supposed to do? I’m getting a bit pissed off because I spotted multiple accounts who registered for the highest plan, used the whole auto-translation quota and quit without paying. Sometimes, users just misbehaving, and this is the reason why there are some dark patterns. Personally, I don’t use any. If you are looking for some decent i18n platform, try SimpleLocalize.io
- praash 5y ago
  Registering for the highest tier plan definitely shouldn't mean a free trial. Why didn't you charge them upfront the moment they wished to choose a bigger non-free plan?
bbunix 5y ago
Datadog for the win in dark-pattern land. Love the software, hate the billing.
ec109685 5y ago
Some of these dark patterns like getting charged for 9 months without knowing doesn't make sense to me. Don't people have to file expense reports each month for their corporate credit cards?
- indus 5y ago
  expense reports going directly to the corporate card are signed-off. Finance see a "software charge" and assume that someone is actually using it. No red flags.
  - ec109685 5y ago
    Where I work, we have to attach the receipt for each one.
sillycube 5y ago
The payment gateway HyperWallet doesn't even let me send email to them without an account. I want to ask the transaction fee before joining but you need an account. I don't understand what service level it is. It's under Paypal so I don't feel surprised at all. Just another enterprisey payment company
jwr 5y ago
SaaS founder here (solo self-founded business), trying for years to be ethical and not use any "dark patterns". The article is one-sided and ill-informed, clearly written by someone who never ran a SaaS business and had to balance the books. Those who run a SaaS will know what I'm talking about (for example, the difference between no-credit-card-required trials and credit-card-required trials is about support costs, not about secretly charging that first fee). They will read the article, conclude that it's ridiculous, and skip it. For those who do not currently run a SaaS themselves, please critically read the article and do not immediately conclude that all SaaS businesses are immoral and use "dark patterns".
- tpxl 5y ago
  It's hard to run a business ethically so that gives you the right to run it unethically? Business convenience should rank far lower than personal convenience in the world. I will _never_ provide a credit card for a free trial because some companies will charge you at the end of the trial and I don't have time to figure out whether you're one of those. I will _never_ provide my phone number for "security reasons" because a load of companies used that excuse to get the phone number then used it for marketing or for correlating it with other personal data. I say that as a failed SaaS co-founder. Being ethical was no part of the reason the SaaS failed.
  - jwr 5y ago
    > It's hard to run a business ethically so that gives you the right to run it unethically? The word "ethically" implies a strong moral judgment. We can discuss ethics of course. For example, why would you think that charging at the end of a free trial is a problem, if this is clearly stated when signing up, notification E-mails are sent before any charge happens, and refunds are provided with no questions asked when necessary? What exactly is "unethical" here? But my point was that many of these decisions are made not because of evil approach to making more money, but because of very practical and down-to-earth things. For example, requiring credit card information before a free trial reduces your signups considerably, leaving only the most serious potential customers. That lessens your support and onboarding load, because you do not spend time supporting non-customers that would not pay you anyway. Obviously this is not a clear-cut decision, but I'm trying to point out that the basis for making those decisions has nothing to do with morals, ethics or "dark patterns". That kind of "dark pattern" conspiracy thought implies a lack of understanding of how a SaaS operates. It's very naïve to think that a SaaS business would care about charging for the first month through "dark patterns". If you run a SaaS, you care about long-term customers, retention, LTV and MRR. New signups are often actually a loss over the first months. So grabbing someones $49 through a "dark pattern" makes no sense: it actually lowers your important metrics, and makes you lose money, because that customer will usually contact support.
yawaworht1978 5y ago
I absolutely think a CC upfront opens many doors to potential abuse and hidden recurring charges , obscure opt out etc. Could use alternative methods to prevent spam, like sms etc. Requiring a credit card is asking for too much trust from the user.
kinard 5y ago
I run a SaaS service and noticed we did a couple of these 'dark patterns', but not intentionally! I've now added to our short term roadmap changes that will resolve these problems. 1. Emailing account holders a couple of days before billing to give them an opportunity to cancel. 2. Emailing account holders whenever a change to their account occurs which would affect billing. This wasn't us being 'dark' more 'lazy', but thanks for highlighting!
- indus 5y ago
  :clap: :clap: Lovely. Most of the time it is software complexity that goes into the way or prioritization of features. Hope your sales team do not start hating you for some of these changes ;-)
danpalmer 5y ago
Another dark pattern is the use of credits. You subscribe for $X/month. That buys you Y credits, which you then spend at different rates depending on your usage. Some services are credits per minute, some are fixed credit amounts. Not only do you have to guess your capacity requirements, you also then have to translate that into a series of tiered variable costs and fixed costs, and translate from credits to currency (often working through bulk purchasing rates) to figure out how much you'll be billed. I manage a SaaS contract that bills like this and I'm not sure I've ever accurately predicted our bill. Also one of their fixed credit cost items is clearly 10x more expensive than it should be when you actually work through the numbers to see how much it costs.
dspillett 5y ago
While there are some valid points here, a lot of it seems to be moaning about having to pay for your own lack of good capacity planning, as if someone else should eat the cost of your estimates being inaccurate or plans falling through. > That’s eight months of paying for nothing. You signed up for a service. You stop using the service but don't cancel. How is that anyone else's fault? Furthermore, your accounting is so bad that you didn't notice for months. Making cancellation difficult and other similar things are dark patterns, this complaint though is just disorganised people trying to pass the buck. > If you’d received an email before the bill hit That would be nice, and many providers do that (I get an invoice for the dedicated server I don't properly use yet each month, which is a reminder that I should get around to the rest of the things it was intended for or downscale the operation), but you could also set reminders when you sign up for something, or keep an eye on your accounts. > Unused seats? Still gotta pay for ‘em. Ask yourself this: if you had customers who agreed to x00 users each and you paid for infrastructure and employed support staff to support this level of user activity, would you be happy to take the hit when half those user accounts don't all end up being needed? I doubt it, so you shouldn't expect other businesses to do so either. Your planning failure is not someone else's problem. > But what if ... you actually ... wanted to add the seats. Well, the CRM would be only too happy to accommodate! Again I wonder how much business the writer is willing to give away for free. There are no links to their own policies to suggest that they operate better than what is being complained about here - if such evidence existed I'd expect a noise to be made. The real issue that is here sometimes is deliberately unhelpful bracketing of payment plans, jumping straight from 20 to 100 to 1000 seats with no provision to pay for a smaller amount of extra seats (perhaps at the 20-plan per-seat cost) because you need 110. But simply expecting to maybe not have to pay at all for the extra is a sign of a distasteful entitlement personality defect. > I’d love to know if you’ve seen or experienced these dark patterns — or worse! Ah, the infamous “please gift us free content for our future articles”!
rakamotog 5y ago
I read the article and after a few para's I know that the author now works for a SaaS expense management company and I am reading marketing material.
- motohagiography 5y ago
  While some marketing is more crass than others, there is no doubt that advising people of dark patterns is valuable, and probably worth money to mitigate. Every security advisory in the last decade has been marketing material for a security company or researcher. Everything should be read critically, and this article reminded me to drop a subscription. You can have an opinion without being dishonest about your interest behind it or its controversy, no?
pupala2020 5y ago
Subscription service is a blessing for both businesses and consumers. However it is shocking to see the exploitations. This is what telecom companies did before congress legislated to protect customers from unscrupulous charges. Hope this doesn’t happen with SaaS as the industry is new and there is a long road ahead for developers and entrepreneurs.

204 points by indus 5y ago

The dark pattern I like the least is the one where providers do not let you set a limit or budget for charges to your account per billing period. For example, I've yet to find a cloud provider that lets you, say, put a $200 a month spending limit on your account. The best we get is a notification system.

rovr138 5y ago
Imagine the issues on something like AWS, Google Cloud, Digital Ocean, Rackspace, etc. Imagine if a company sets a limit. One that allows for burst and growth. Then they forget to update it, and then one day, all their servers, data and everything else is gone. Even if things are offline, they accrue costs, so the only thing to do when a limit is reached is destroy everything. What’s the balance?
- heavyset_go 5y ago
  > Then they forget to update it, and then one day, all their servers, data and everything else is gone. Even if things are offline, they accrue costs, so the only thing to do when a limit is reached is destroy everything. That's not the only thing you can do. It takes quite a while from non-payment for OVH to take down their clients' services and delete their data, for example. They give customers a month long grace period before taking their service offline, and then there's another waiting period before they delete the data. At any point clients can resume service with payment.
- ahtihn 5y ago
  It should be trivial for the provider to compute the cost of offline resources and account for it when triggering the limit to give a few days to react before destroying everything.
- joshmanders 5y ago
  I'm implementing this in my cloud hosting platform (https://primcloud.com https://primcloud.com) and how we plan to do it is email triggers when certain thresholds are met, and if no action is taken, give a grace period before taking stuff offline. Yes they will be charged for that grace period, but setting a limit of $200 and being charged $250 sure beats getting a random $1,000 charge.
  - rovr138 5y ago
    Definitely. Maybe a % with minimum time and a max on money.
    - indus 5y ago
      This is tricky. We have alerts from AWS for monthly threshold, but most of the time it is ignored until the $$$ becomes large enough for the Engineerin Manager to get worried.

teekert 5y ago

I really like Digital Ocean and Linode in this respect, I can spin up a server, play all night, destroy it and it cost me cents. It's easy to see what't still running and monthly emails (payed per minute) remind you if you still have things running. I never had any surprises. But then again, I am the VM kind of guy, not the hyperscaler type.

brooklinnash 5y ago

"Our research shows that companies underutilize their SaaS products by an average of 30% across the board" Big yikes. I'm curious which of these approaches would have the biggest impact on bringing that SaaS waste down.

indus 5y ago
Though not easy to implement, but consumption driven billing rather than seat/user-driven would reduce the grief quite a bit. In the early days AWS EC2 became popular for their per compute per hour pricing compared to hosting providers fixed monthly cost.

cosmolev 5y ago

Subscription-based software is already a dark pattern.

wbobeirne 5y ago
What would you recommend products that host the service and have ongoing upkeep costs to do?
- newfonewhodis 5y ago
  I would recommend the creators ask themselves if their software _really_ needs to be hosted or can it be sold as a one-off (self-host or desktop/mobile).
  - Veuxdo 5y ago
    Seems orthogonal. You can have subscription-based desktop/self-hosted, and one-time-payment hosted software.
  - mdasen 5y ago
    I don't think you should be downvoted for this, but I do think there are some reasonable responses to it. First, supporting desktop/mobile software can be hard. Customers have all sorts of weird things on their machines. iOS cuts down on that, but you still lack access for a lot of debugging and that can cost a lot of money. Support is expensive. Second, I think there's this idea that desktop/mobile software is a one-off. What happens when Apple removes an API that your program used? Do you tell uses "sorry, your $X doesn't entitle you to a working program anymore?" For better or worse, software requires ongoing investment. If software requires ongoing investment, it kinda requires ongoing payment - or operating on the idea that new users will pay for the improvements required by older users. However, that's a dangerous assumption. At some point, there are a lot more older users than there are new users. Many companies tried to operate pension schemes assuming that new workers would pay for older workers retirement benefits. At some point, there are fewer new workers than there are old workers and it collapses. Software maintenance is important, but it can be hard to price. Do you tell users "you have a license for 2.0, but you'll need to pay $X to upgrade to 3.0...oh, and 2.0 won't be updated to support iOS 14 so you're basically forced to upgrade"? Do we tell creators "if you don't keep this software maintained in pristine condition for the next 20 years, you're being predatory"? That kinda just demands that they do uncompensated work. Even if software isn't hosted, there are ongoing costs. Some of that can be priced into the initial purchase of the software. Some of it can't be. It's hard to guarantee that software will continue working for 2, 5, 10, 20 years when you have no idea what that might entail in terms of work. 20 years ago, Apple was shipping Mac OS 9. Since then, I may have needed to upgrade my app from Classic to Carbon, from Carbon to Cocoa, from 32-bit to 64-bit, from PowerPC to Intel, and now from Intel to ARM - not to mention the huge number of APIs that have been broken along the way. Is the right model something like what JetBrains does where you get a perpetual license to the version you bought, but that version might just stop working given changes around it (like OS upgrades or new machines it isn't compatible with)? That doesn't force you to subscribe, but it does mean that you're likely going to need to upgrade. Programming languages move on and you're stuck with an IDE highlighting things as bugs or that won't launch your program because it isn't compatible. Subscription-based pricing gives creators an incentive to keep investing in their program and it gives customers predictable costs. No one wants to hear "sorry, this won't run on M1 and we're not going to upgrade it for free for you so here's a $X charge that you have no way around given that Apple is abandoning Intel".

hdjjhhvvhga 5y ago

> Free trials should not require a credit card. Collecting your payment information is an obvious red flag that you will be billed as soon as the free trial period ends. I remember many people on HN defending this pattern saying that they are not interested in people who don't want to provide their CC details, that they are bad customers, they just want a free ride, and they are not sorry for setting it up like this. Oh well. I guess with time more people get burned and will finally learn the hard way this is just one of many grey patterns.

rhizome 5y ago
This is exactly right. For years it was conventional business wisdom and best practice to focus on getting the CC. We could probably find some pretty embarrassing (for the web industry) threads if we wanted to look.
human 5y ago
Requiring a credit card for a trial is fine, as long as you don’t convert automatically to a paying membership. And if you do, please send me a reminder a week before at least.
- dhimes 5y ago
  I'll add: A reminder with an opt-out link.
rapind 5y ago
How is this a dark or “grey“ pattern. Are they being sneaky about it? At most it could be a signal that a business intends to be a douche, but that’s only because douchey companies ruined it. Just like duchey free customers ruined that for everyone. My employer probably thinks payroll is a “grey” pattern by this logic.
- mitchdoogle 5y ago
  It's a dark pattern because they claim the trial is free, but ask for a credit card. They are betting on the user forgetting to cancel, or worse, actually make it difficult to cancel. If it was just about giving the user a chance to try a product, they wouldn't need to collect credit card information. Some people claim it helps to prevent abuse. Maybe, but there are other, user-friendly ways to prevent abuse.

human 5y ago

I’m not sure it qualifies as a dark pattern, but I was really frustrated by the Logmein pricing. I was paying a relatively expensive amount for my 100 computers package. Once I went over that threshold I had to convert to the 500 computers package which cost 4x was I was paying. That was true even if I had 101 computers and not 499. I ended up upgrading with a negotiated price but still don’t understand why it’s not a price per computer.

rhizome 5y ago
Easier bookkeeping on their part.
- elliekelly 5y ago
  That might be the reason for the different tiers but there is definitely a dark pattern in the auto-upgrade GP describes. LogMeIn could just as easily put a hard stop at 100 computers with a notification the user needs to upgrade to a higher tier package. Instead they auto-upgrade the user without asking. (I’m assuming there’s no way to avoid the auto-upgrade. It’s one thing if a user opts in to the tier scaling for their own convenience I think that’s different.)
  - human 5y ago
    In their defense, I wasn’t auto-upgraded. I just couldn’t add computers anymore. I hovered around 99 for a while, removing old computers, but one day I had to open up my wallet.
- indus 5y ago
  Easier bookkeeping is the main ingredient of debate between consumption-based billing (AWS, Twilio, etc) vs user-based billing.
indus 5y ago
Not having consumption-based billing is definitely a callout issue and many exploit the simplicity of bundled t-shirt (Small, Medium, Large) SaaS pricing.

elias94 5y ago

I forgot the AWS password once for an account with only one S3 bucket. I did the recovery procedure but they wanted to verify my identity using my document. I send them my ID, which was with a different address from my account information. They didn't accept my ID and I wasn't able to stop the service and the recurring payment. Fortunately I registered my payment with a prepaid credit card, so was easy to empty the card and let them billing into the void. Since then, I always use a prepaid card for recurring payment. It saved my ass in a way. One of the largest dark pattern is also having a poor customer service.

r00fus 5y ago
Is failure to pay (ie, card authorization) good enough for inability to cancel? Couldn't they just invoice you and hold you liable for fees regardless?
- indus 5y ago
  A failed card auth does not remove the obligation to pay. Most vendors write if off, and don't follow-up after a few emails. Plus, they don't want users to get pissed off and post a negative review. Many vendors have now optimized their billing flow to reduce write-offs. They start charging on the first of the month for the upcoming use, and then cancel the account if the auth continues to fail.
  - inetknght 5y ago
    > A failed card auth does not remove the obligation to pay. Let them sue over it. They'll just love how the courts would rule in favor of a customer who clearly tried to recover their account in good faith and tried to cancel the billing in good faith and, failing both, canceled the billing in the only remaining way since the company provides literally zero customer-friendly options.
    - indus 5y ago
      Definitely the customer has a case if there is an intent to cancel the service. But, just ignoring based on a failed auth may not shift the liability. Infact, when disputing such charges with the issuer, the customer always wins if there was an attempt to cancel the service.

digitalengineer 5y ago

Hubspot. The yearly plan is way cheaper. But you need to cancel it 3 months in advance or you’re on the hook for ‘the same period’, thus another year. No reminder email of course.

indus 5y ago
applicable to a majority of annual contracts of top SaaS vendors.
rsstack 5y ago
FullStory sent us a reminder email last week that we need to cancel 2 months before the annual contract ends. I started a Slack thread, we all agreed we love FullStory, done. I think SaaS that try to trick their customers by not reminding them about their cancellation policy (which isn't consistently 1 month, 2 months, or anything, and is hard to track when you're a small startup) are just afraid their product isn't good enough or valuable enough for people to renew. Instead of improving their product, some exec can say "let's not remind them", and get about the same rate of retention.

notyourday 5y ago

> Free trials should not require a credit card. I'm not in business to provide services to people who want stuff for free permanently. They complain on forums, raise stink and spend nearly no money. They are not my customers. I always ask for a credit card for a free trial. The fewer non-customers signup, the better it is for me.

lgl 5y ago
While I kind of understand your point of view and not all businesses are equal, a free trial is not stuff for free permanently. You should be confident that your product will be able to make the customer willingly add their credit card after their trial is over if you are indeed providing them with a useful service.
- not1ofU 5y ago
  I agree, and was going to posit the same argument, however, a credit card is a useful way to get unique info. If someone signs up to free trail without something like a CC, instead using an email address, then they just have to register a new email address to get further free service. Although I am sure there are alternatives that I havent considered.
brooklinnash 5y ago
What's your thought on alternatives, like Ahrefs' $7 for 7 days trial?
- notyourday 5y ago
  Unrestricted service at the highest plan level, 1 to 2 weeks, credit card not only required but is authorized for the plan price - do not settle transaction as it is still a free trial. This ensures: 1. Whoever tries the service at least theoretically met minimum qualification to be a customer - they have a credit card and can authorize several hundred dollars on it. 2. We get the real lead. 3. We limit the number of people who recycle free trials -- this happens a lot.

atgarone 5y ago

I got locked into a reseller agreement with JustHost for my wife's GSuite account, which she uses for her full-time work. Now I'm paying them $90 a year just so I can retain my GSuite services without her having any downtime or losing her data. Only recently did I discover GSuite has an FAQ for getting out of reseller agreements. Going to have to act on that.

jmsuth 5y ago

This is one of my biggest qualms with building SaaS apps on the App Store. You can't do a free trial without requiring an Apple Pay confirmation which will auto-convert. We get lots of negative reviews because of it, but there's no way around it without offering some free version.

indus 5y ago
Though apple pay does a decent job on the cancelation UI, the free-to-paid notifications (in email) are always a miss. I have seen this in trial subscriptions at home with buyer's remorse later.

CPLX 5y ago

These are far from the worst patterns. I've seen so much awfulness out there. My favorite recent one was a renewal if you don't cancel by a deadline that's months ahead of the actual end of the contract period and it also had a substantial rate increase and all the language that we supposedly agreed to wasn't actually present in the contract we signed. Those terms were in one of those "incorporate by reference" clauses where it says this contract incorporates terms and conditions that are at the following URL and it's 45 pages into the fine print of that URL. I mean supposedly, since it's their URL and could just change the terms whenever they want and lie about it. Which by the way wasn't clickable in the Docusign. Basically it was in an unlit basement behind a sign that said beware of the leopard. It's not ethical. It's just exhausting to deal with some of these companies. I think we all know who they are, they tend to be concentrated in the field of SaaS companies that cater to the sales and marketing functions. Lately I've had what I've found to be a fairly clever solution however. We wrote up a standard document that contains our terms and conditions for SaaS providers. The key clauses basically say "We hereby give formal notice that we do not consent to any automatic term renewals, any automatic price increases, any charges to credit cards made 'on account' without our specific consent as to the date and amount charged. To the extent our agreement requires advance written notice of any of the above this letter serves as that notice." and so on. Then we send it certified mail to the company's corporate HQ address and keep the tracking number. We do this on the same day we sign any software contract, it's basically an automated process at this point. So whenever it comes around, and it has, we just say sorry we've already given formal written notice we don't consent to that. Here's a scan of the document and the USPS receipt maybe work on your internal communications. The fact that we have to do this is apalling but hey it's better than the alternative.

Plasmoid 5y ago
Does it actually work? Have you tested in in court?
- CPLX 5y ago
  Haven't made it to court but it would certainly be legally sound. Courts love certified mail and formal notices it's not even clear what counterargument they could have. They require notice, and we gave notice and can prove it. But in real life what it really does it get them to back off and go back to having a normal negotiation about what we do want to do for renewal instead of the bullshit attempt to mislead and trap us. Needless to say if there's any viable alternatives to companies that do this we take them but in some categories all the options suck.

encoderer 5y ago

Of all the nasty things somebody can do with billing, I'm surprised the author leads with card-upfront trials. "Free trials should not require a credit card." This is opinion presented as fact. This is not a dark pattern. Totally unrestricted free trials are wonderful, you've invested a ton in your product and you want a prospective customer to experience everything. But there are legions of abusers and bad actors of all kinds. Having an opt-in to use/abuse your platform for 2 weeks is not always viable. Card up front is not a perfect filter, but it's helpful in turning this noise way down and letting you focus on helping actual prospective customers become successful with your product.

atgarone 5y ago
I'm sure that when you're analyzing SaaS transactions for a year (full time), you see a lot more data than we more-select-few-who-can-discern do.
- dinobones 5y ago
  You forget this is HN, where software engineers will go off on tangent talking about how "they could have designed the airplane rotor to not crash" or something equally ridiculous. Everyone here is an expert at everything, because they wrote a blog once, or since Paul Graham is perceived to be an expert on everything, they can be too.
  - indus 5y ago
    > since Paul Graham is perceived to be an expert on everything, they can be too. ROFL.
  - perl4ever 5y ago
    As you know, Bob, they let anybody on here regardless of occupation or knowledge of Phil Graham. So some random commenter could perfectly well be an aerospace engineer. Or someone that's never been employed in their whole life.
  - deleted 5y ago
    [deleted]

schnebbau 5y ago

> Your company needs a CRM, so you sign a year-long contract for, say, 50 seats on your chosen SaaS CRM. Then — yikes! After six months, half your team is laid off. Will the CRM let you adjust and pay for 25 seats for the remainder of their contract? > That’s a big NO. Unused seats? Still gotta pay for ‘em. (It’s called “SaaS waste” for a reason.) You committed to paying for 50 seats for a year. The CRM may have made decisions based on that commitment, such as hiring people, or themselves committing to bigger plans with their providers. Why should they get screwed because you choked? Don't commit to long fixed periods if there is any doubt you won't make it.

hermes8329 5y ago
Saas has obscene markups
- ZephyrBlu 5y ago
  It has "obscene markups" based on costs, but that is not how SaaS is priced. It's priced on value.
awillen 5y ago
In general I don't think it's fair to describe anything as a dark pattern this is clearly communicated in a contract. Same with "Here’s a similar problem with a different scenario: You sign a one-year contract with a SaaS provider. You start paying immediately. The process to get API access, build integrations, set up the software, and onboard and train your team takes three months. In those three months, you still paid for a service you couldn’t use yet. In fact, you had to pay to set it up! You had to pay upfront to get the functionality you needed." Do I generally think that's a bad policy? Sure (depending on whether there are significant resources required on the software company's side for you to build your integration). If you're told this is going to be the case and agree to it, is it a dark pattern? Clearly not.
- CPLX 5y ago
  That’s not really a fair way to evaluate contracts for fairness and ethical conduct. Not only does the contract have the obligation to be clear (and let’s be blunt the people that do this are often not trying to be clear about what they are doing) it also needs to meet basic standards of reasonableness. Specifically, to the extent that a contract diverges sharply from the general understanding each party has about how the world works, the more the drafting party has an obligation to clearly call out the terms in a manner commensurate with the importance of the contract term. Legal documents aren’t software code, it’s a classic mental error developers make when discussing them. They are evaluated by humans. For example, it would not be reasonable to have a single sentence buried in the middle of a 20 page SaaS contract that obligated you to purchase cat food, or signed away the rights to your apartment. Wouldn’t matter how plainly worded the sentence was and if it was duly signed. You’d still have to convince a judge that was a reasonable thing to do. Good luck with that. And regardless of legality it’s obviously not ethical it’s a trick, intended to be deceptive. Obviously there’s subtlety to this and the exact details matter. But that’s my point. You can’t just fall back on the idea that anything you get someone to agree to isn’t a dark pattern. The whole point of dark patterns as a concept is that you’re tricking people into agreeing to unreasonable things.

lordnacho 5y ago

Is anything being done about this kind of thing? It's one of those steal-a-dollar from 1M people tricks. If you stole 1M from one person they'd do something about it. Pick 1M pockets and nobody can do anything.

indus 5y ago
there are a few ideas, to let technology help. Others are around legislation, such as the one that came yesterday from FTC on call to cancel being illegal.

tie_ 5y ago

Here in Germany, physical businesses have even more egregious subscription policies than most "dark" SaaS-es. Think, you do not cancel 3 months before expiration date - congrats, you're now signed up for another year. As a result, ended up writing a small PWA to keep track of my contracts and subscriptions.

indus 5y ago
Whaat! This one is new. You mean subscriptions from your neighborhood store such as milk, bread, newspapers, etc?
- niklasd 5y ago
  Newspapers, fitness studios, mobile providers, railway discount ticket (Bahncard). Can't say for neighborhood stores, I haven't really used a subscription at such a shop.
- tie_ 5y ago
  More like gym, "clubs" (Verein-s), mobile phone, internet, electricity, etc. It's an established contractual practice, and e.g. Telekom are not in any way obligated to notify you when your cancellation date approaches. They can very well sue you, however, should you refuse to pay your automatically-renewed-in-advance contract. Even in the cases where you're allowed to cancel on the last day of the subscription, we as humans are very prone to forget to do that, particularly for longer-term contracts. Tracking contracts and subscription deadlines is a damn profitable habit that I wish I had acquired much earlier.
  - indus 5y ago
    Curious: if they sue, then the only damage is money they owe or there is more to it such as credit history, etc?
    - tie_ 5y ago
      I haven't really tested it in court, though I did get the official correspondence that leads up to it. Friendly law practitioner had suggested that I really don't stand a chance. Not sure about credit damage, but in case of a loss in such a suit, I'd also have to cover the expenses for the other side, so it's a risky proposition. With my wife we did consider it for a while, but then decided it's better to do focus on solving that problem with software and thus started working on contrax.app (shameless plug!).

bazhova 5y ago

AWS costs are somehow always higher than your estimate. Even when using their little calculator. That's the dark pattern right there.

HatchedLake721 5y ago
Emmm, no? You can download detailed billing and drill down if you want. If you see differences, one reason is that with hourly billing your monthly bills will be different, depending whether it’s a 28, 30 or 31 day month.
- justin_oaks 5y ago
  I've been with AWS for a number of years (personal and for work) and haven't seen this problem either. Some services will be higher if you don't account for all the costs. You can do the math for an EC2 instance but if you don't account for storage prices and bandwidth prices then the bill will be higher than you expect. But some service prices will be lower than you expect. If you create multiple EBS snapshots from the same server, you'll notice that the price you pay isn't the sum of the individual snapshot sizes. It's far less because each new snapshot only saves data from blocks that have changed since the last snapshot.
- tyingq 5y ago
  For people just starting, I can see it being true. A pedestrian example might be a Lambda. You look at the pricing on their site and calculate it down to the penny, but the cost ends up higher. Because the Lambda pricing page doesn't mention the Cloudwatch logs that were created with your Lambda, but they aren't free. (Leaving free tier stuff out of the picture).

jedberg 5y ago

This is a very cynical take. Not all of these things are designed to trick you. For example, requiring a credit card for a free trial is to prevent free trial abuse. A normal person can only get so many valid credit card numbers, assuming you can detect burner cards (which for the most part the CC companies will happily help you do). Yes, a good company will notify you that a trial is going paid, and a great company will require an affirmative action on your part, but the main goal isn't to trick you and hope you forget. Also, the part about not prorating costs if you use less resources. Usually you get a discount for paying up front. The reason you get a discount is because it allows the company to do more efficient resource planning, a savings they pass on to you. If they allowed you to cut back, you haven't upheld your part of the deal. A big company can absorb the loss, but a small one can't. Yes, some companies do these are dark patterns to increase their profits. But most have some pretty good non-nefarious reasons to act like they do.

moneywoes 5y ago
Does Stripe detect something like privacy.com?
- paulryanrogers 5y ago
  They probably have their own BIN/IIN. So it may be trivial. Still privacy.com per merchant cards are more likely to be actionable than stolen or prepaid cards.
- jedberg 5y ago
  They might, but also privacy.com will not let you get more than two cards per site without a special exemption. I learned this when I tried using multiple cards for AWS, one for each app. They wouldn't let me do it. So maybe Stripe knows which burner providers have their own restrictions and treat them differently?
- parkerhiggins 5y ago
  Stripe Radar can be configured to provide signals that would reflect a virtual card, but not explicitly. Further trying to solve preventing virtual cards use potentially introduces false flags. Requiring 3D secure may. Depending on the product and audience, the prevalence of virtual cards may be extremely low. Outside of hackernews, the payments industry, and business cards nobody uses virtual cards like privacy.com

saahilsaini 5y ago

as a new entrepreneur trying to understand saas expenditures this was an insightful read into the industry

wly_cdgr 5y ago

Without reading too much into the fact, it's still pretty funny that this is marketing for a SaaS product

magicalhippo 5y ago

> Companies waste tens of thousands of dollars every year on SaaS products they subscribe to but don’t use. And when I say “don’t use,” I literally mean zero logins for paid users during a subscription period. We have a SaaS product, and we see that as well. Usually our sales folks will have a look every now and then and see if there's a lack of activity. Almost always it's the result of someone quitting or losing their job, and our software gets lost in the handover of responsibilities. I've heard of several cases where sales has effectively re-sold our software more than 3-4 times to the same division in a company over the years.

jscheel 5y ago

I'm quite a bit leery of this article, even though some of it is pretty accurate. There are some glaring problems with it, and I would advise you not to take it as gospel truth. First, requiring a credit card for free trials is often necessary to weed out bad actors. Second, the author spends an awful lot of time complaining about being held to the terms of a contract that you willfully signed. I get that renegotiating a contract is nice to do for your customers, but it's a contract for a reason. Usually, when you signed up for that annual plan that you suddenly want out of, you were given a discounted rate by going annual. I notice that the author never mentions this when suggesting that companies are bad for holding up the terms of a contract. Finally keep in mind that this article is a marketing piece written by a saas product for rolling up saas payments.

petercooper 5y ago

I really appreciate how Slack handles things by scaling down your payment month by month based on how many users are actually using the service. I wish more SaaS providers, especially big ones with the capacity to develop the feature, would do this rather than lean on people or companies forgetting to remove seats.

indus 5y ago
Slack is the gold standard. I reached out to a Senior Product person at a very large SaaS vendor on auto-scaling the seats -- based on simple monthly active. His response: "Our Sales team would never let that happen."

SavantIdiot 5y ago

Forgetting to kill your cloud instances and getting charged isn't a dark pattern, no more than forgetting to fill your gas tank isn't an automotive manufacturing dark pattern, or leaving your water running in the basement sink and forgetting all winter and then having a fight with your husband just before Christmas because the water bill is $1000 and you're the only one that uses the basement utility sink but only in the summer because it is too cold in the winter...

scrose 5y ago
Forgetting to shut down an instance in the cloud is the least worrying problem. In AWS, everything has a price. And some things don’t have a price until they’re the only thing left(ie. Elastic IPs that only charge once they are not assigned to an instance). For someone new to AWS and testing things out, a closer analogy would be like moving into a new house and trying to find out which pipes are leaking
phist_mcgee 5y ago
I would say it's dark because the platform does not usually place any emphsasis in letting you know it's still there or not. There are no built in safety rails (like a check fuel light) that can help. These platforms are designed to be obtuse.
- danpalmer 5y ago
  I'd challenge these being "obtuse", I think it's more likely that they are designing for a different type of customer. As an engineer working on a production system, everything in code, etc, I don't really want an alert saying "Are you sure you still want to be running your database?". This isn't really a feature that most production systems need. What I'd like to see is features for experimental work – being able to mark an AWS account, or org, or maybe individual services/resources, as "experimental" and have it auto shut off after some reasonable amount of time, with clear warnings during use (as much as possible) that this is an unsupported experimental service. Hell, if the time limit/capacity limit was low enough, I feel like these could be a permanent free plan with cloud providers. The question is: are these customers worth designing features for? I could see why they might not be, although I think it would be beneficial to the industry.

jpomykala 5y ago

“Free trials should not require a credit card.” I have a small project where I allow people to auto-translate their web and mobile applications. I’m using Google Translate and DeepL for translating texts from language to another. DeepL charges me $20 for every 500k translated characters. What I supposed to do? I’m getting a bit pissed off because I spotted multiple accounts who registered for the highest plan, used the whole auto-translation quota and quit without paying. Sometimes, users just misbehaving, and this is the reason why there are some dark patterns. Personally, I don’t use any. If you are looking for some decent i18n platform, try SimpleLocalize.io

praash 5y ago
Registering for the highest tier plan definitely shouldn't mean a free trial. Why didn't you charge them upfront the moment they wished to choose a bigger non-free plan?

bbunix 5y ago

Datadog for the win in dark-pattern land. Love the software, hate the billing.

ec109685 5y ago

Some of these dark patterns like getting charged for 9 months without knowing doesn't make sense to me. Don't people have to file expense reports each month for their corporate credit cards?

indus 5y ago
expense reports going directly to the corporate card are signed-off. Finance see a "software charge" and assume that someone is actually using it. No red flags.
- ec109685 5y ago
  Where I work, we have to attach the receipt for each one.

sillycube 5y ago

The payment gateway HyperWallet doesn't even let me send email to them without an account. I want to ask the transaction fee before joining but you need an account. I don't understand what service level it is. It's under Paypal so I don't feel surprised at all. Just another enterprisey payment company

jwr 5y ago

SaaS founder here (solo self-founded business), trying for years to be ethical and not use any "dark patterns". The article is one-sided and ill-informed, clearly written by someone who never ran a SaaS business and had to balance the books. Those who run a SaaS will know what I'm talking about (for example, the difference between no-credit-card-required trials and credit-card-required trials is about support costs, not about secretly charging that first fee). They will read the article, conclude that it's ridiculous, and skip it. For those who do not currently run a SaaS themselves, please critically read the article and do not immediately conclude that all SaaS businesses are immoral and use "dark patterns".

tpxl 5y ago
It's hard to run a business ethically so that gives you the right to run it unethically? Business convenience should rank far lower than personal convenience in the world. I will _never_ provide a credit card for a free trial because some companies will charge you at the end of the trial and I don't have time to figure out whether you're one of those. I will _never_ provide my phone number for "security reasons" because a load of companies used that excuse to get the phone number then used it for marketing or for correlating it with other personal data. I say that as a failed SaaS co-founder. Being ethical was no part of the reason the SaaS failed.
- jwr 5y ago
  > It's hard to run a business ethically so that gives you the right to run it unethically? The word "ethically" implies a strong moral judgment. We can discuss ethics of course. For example, why would you think that charging at the end of a free trial is a problem, if this is clearly stated when signing up, notification E-mails are sent before any charge happens, and refunds are provided with no questions asked when necessary? What exactly is "unethical" here? But my point was that many of these decisions are made not because of evil approach to making more money, but because of very practical and down-to-earth things. For example, requiring credit card information before a free trial reduces your signups considerably, leaving only the most serious potential customers. That lessens your support and onboarding load, because you do not spend time supporting non-customers that would not pay you anyway. Obviously this is not a clear-cut decision, but I'm trying to point out that the basis for making those decisions has nothing to do with morals, ethics or "dark patterns". That kind of "dark pattern" conspiracy thought implies a lack of understanding of how a SaaS operates. It's very naïve to think that a SaaS business would care about charging for the first month through "dark patterns". If you run a SaaS, you care about long-term customers, retention, LTV and MRR. New signups are often actually a loss over the first months. So grabbing someones $49 through a "dark pattern" makes no sense: it actually lowers your important metrics, and makes you lose money, because that customer will usually contact support.

yawaworht1978 5y ago

I absolutely think a CC upfront opens many doors to potential abuse and hidden recurring charges , obscure opt out etc. Could use alternative methods to prevent spam, like sms etc. Requiring a credit card is asking for too much trust from the user.

kinard 5y ago

I run a SaaS service and noticed we did a couple of these 'dark patterns', but not intentionally! I've now added to our short term roadmap changes that will resolve these problems. 1. Emailing account holders a couple of days before billing to give them an opportunity to cancel. 2. Emailing account holders whenever a change to their account occurs which would affect billing. This wasn't us being 'dark' more 'lazy', but thanks for highlighting!

indus 5y ago
:clap: :clap: Lovely. Most of the time it is software complexity that goes into the way or prioritization of features. Hope your sales team do not start hating you for some of these changes ;-)

danpalmer 5y ago

Another dark pattern is the use of credits. You subscribe for $X/month. That buys you Y credits, which you then spend at different rates depending on your usage. Some services are credits per minute, some are fixed credit amounts. Not only do you have to guess your capacity requirements, you also then have to translate that into a series of tiered variable costs and fixed costs, and translate from credits to currency (often working through bulk purchasing rates) to figure out how much you'll be billed. I manage a SaaS contract that bills like this and I'm not sure I've ever accurately predicted our bill. Also one of their fixed credit cost items is clearly 10x more expensive than it should be when you actually work through the numbers to see how much it costs.

dspillett 5y ago

While there are some valid points here, a lot of it seems to be moaning about having to pay for your own lack of good capacity planning, as if someone else should eat the cost of your estimates being inaccurate or plans falling through. > That’s eight months of paying for nothing. You signed up for a service. You stop using the service but don't cancel. How is that anyone else's fault? Furthermore, your accounting is so bad that you didn't notice for months. Making cancellation difficult and other similar things are dark patterns, this complaint though is just disorganised people trying to pass the buck. > If you’d received an email before the bill hit That would be nice, and many providers do that (I get an invoice for the dedicated server I don't properly use yet each month, which is a reminder that I should get around to the rest of the things it was intended for or downscale the operation), but you could also set reminders when you sign up for something, or keep an eye on your accounts. > Unused seats? Still gotta pay for ‘em. Ask yourself this: if you had customers who agreed to x00 users each and you paid for infrastructure and employed support staff to support this level of user activity, would you be happy to take the hit when half those user accounts don't all end up being needed? I doubt it, so you shouldn't expect other businesses to do so either. Your planning failure is not someone else's problem. > But what if ... you actually ... wanted to add the seats. Well, the CRM would be only too happy to accommodate! Again I wonder how much business the writer is willing to give away for free. There are no links to their own policies to suggest that they operate better than what is being complained about here - if such evidence existed I'd expect a noise to be made. The real issue that is here sometimes is deliberately unhelpful bracketing of payment plans, jumping straight from 20 to 100 to 1000 seats with no provision to pay for a smaller amount of extra seats (perhaps at the 20-plan per-seat cost) because you need 110. But simply expecting to maybe not have to pay at all for the extra is a sign of a distasteful entitlement personality defect. > I’d love to know if you’ve seen or experienced these dark patterns — or worse! Ah, the infamous “please gift us free content for our future articles”!

rakamotog 5y ago

I read the article and after a few para's I know that the author now works for a SaaS expense management company and I am reading marketing material.

motohagiography 5y ago
While some marketing is more crass than others, there is no doubt that advising people of dark patterns is valuable, and probably worth money to mitigate. Every security advisory in the last decade has been marketing material for a security company or researcher. Everything should be read critically, and this article reminded me to drop a subscription. You can have an opinion without being dishonest about your interest behind it or its controversy, no?

pupala2020 5y ago

Subscription service is a blessing for both businesses and consumers. However it is shocking to see the exploitations. This is what telecom companies did before congress legislated to protect customers from unscrupulous charges. Hope this doesn’t happen with SaaS as the industry is new and there is a long road ahead for developers and entrepreneurs.