Most software companies offer something like free updates for X months. After X months, you can may $Y to renew your license to download updates for Z more months. Assuming it is free updates for 1 year, then renew for $30 for another year. What do you think about automatically billing them the $30 after the first year, so they constantly have access to updates? I know there are plenty of people who forget to renew their access, and then get all confused because they cannot download the software, and maybe at that point they don't have money to renew, or it simply drags out the process... On the other hand, even if it was clearly stated, I am sure there are plenty of people who would call it an unauthorized charge or something... So, which way should I do this?
This is a tough one. I think that if you clearly state that they will be billed, unless they cancel, it should work out okay. But of course, I am no lawyer!
Recurring billing can have its drawbacks, that's for sure. Usually, sending an email a few days before you are going to charge the consumer is a good idea and then a receipt once the charge is done. This way, it gives them an out and helps to prevent the Code 41 chargeback (Cancelled Recurring Transaction)