Fourteen years ago, anyone could buy Windows or Adobe Photoshop. Though the one-time fees could be steep (Photoshop started at $699 in 2010), users owned their license outright after money changed hands, with no additional transactions required. If you miss those days, too bad — we’re in the subscription era, and that essential software is only available as a rental.
What drives the tech industry’s enthusiastic embrace of the subscription model? The first reason is no surprise: It’s the money. According to ZDNet, subscription fees generate more predictable and stable revenues than one-time purchases, and encourage customer loyalty (even when the customer doesn’t like it).
There are other practical reasons — cloud-based computing doesn’t necessarily lend itself well to a one-time purchase model, and a single payment may not balance out the perpetual technical support that consumers have come to expect. Software subscriptions also offer greater flexibility for businesses, which can simply pay for the licenses they need and avoid enormous one-time fees for every employee.
But consumers can quickly find that subscription fees — for software, music, Amazon, streaming video, and the million other tiny features and services that cost just a few dollars on their own — add up quickly, eating away at paychecks and straining our household budgets. According to CNet, consumers are suffering from “subscription creep,” which bleeds more than $1,000 each year from their wallets. Individual subscriptions are easy to forget about and often unnecessarily difficult to cancel, which may prompt consumers to resort to another subscription service — one that finds and cancels unused and forgotten subscriptions.
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In theory, almost anything can be a subscription, and plenty of companies are testing the waters with new and novel ways to make us pay for things we used to own outright. Take the car industry, for example, where automakers are toying with monthly fees to activate heated seats or allow you to use all the speakers installed in the car you already purchased. But according to MotorTrend, that sales model may still be a bridge too far — it seems that consumers really detest paying extra to use features that they already own.
Image by Richard Duijnstee
