
Subscriptions Are Remaking Corporate America (2018) - whinythepooh
https://www.barrons.com/articles/how-subscriptions-are-remaking-corporate-america-1544233694
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buboard
subscribe to read hahahah

For one, I hope subscriptions die. It's a pernicious trend that is borderline
fraud for consumers (like gyms, profiting from users who simply forget to
unsubscribe or making it painfully hard to unsubscribe). It's also
exclusionary for most of the world for whom the subscription price might be a
year's income. With downloadable software it was kind of possible to find a
crack online, but web apps and content make it almost impossible.It also makes
individual property ownership impossible. we need honest,anonymized payments
on the web.

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swagasaurus-rex
I think subscriptions are fine; it is the banks that give power to
corporations by making it impossible to control who bills your accounts.

If you could easily see recurring billing charges and cancel on your bank's
end easily, companies would have to step up and offer a useful service.

~~~
TeMPOraL
Part of the problem is that they handle much differently than purchases. To
buy something you need to have enough money at some point in time.
Subscriptions require you to have a stable cashflow. The former is usually
easier than the latter.

On top of that, subscriptions are also relationships you have to keep track
of. With a lot of subscriptions, it can become overwhelming.

~~~
aidenn0
Most subscriptions are on credit cards, and having available credit implies a
stable cashflow (even if you are operating at a loss).

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ajdlinux
Visa/Mastercard debit cards are a thing.

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TeMPOraL
In fact, I'd argue that credit cards are US thing. You can pay for most stuff
on-line with debit cards just fine. Over the past decade, I had to use PayPal
maybe 3 times, because some braindead payment system wouldn't accept debit
cards.

(It may differ between classes and countries, but over here in Poland around
people I know, having a private credit card is like shaving with a straight
razor - it's awesome if you can handle it without hurting yourself, but most
people can't and are smart enough to not even try.)

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leetcrew
> having a private credit card is like shaving with a straight razor - it's
> awesome if you can handle it without hurting yourself, but most people can't
> and are smart enough to not even try.

as someone who treats a credit card like a charge card (pay it off in full
every month, without exception), I don't really understand this mentality.
imo, managing a debit card is way harder. I have to ensure that I have enough
money in my checking account every time I make a purchase. it feels like
inevitably my payday will line up in such a way that I overdraft on a purchase
I could have easily afforded by the end of the month.

~~~
TeMPOraL
To use debit card, all you have to do is to know how roughly how much money
you have. You have to know this even if you have a credit card, otherwise you
risk not being afford to pay it off.

The danger with having a credit card is that you have an _option_ to not pay
it off. With debit cards, it's impossible. You can overdraft a little if
you're tricky, but that's about it - whereas with a credit card you can end up
going negative and finding it difficult to get back to black (whether because
of your own faults or external circumstances).

I compared a credit card to straight razor because both are useful and safe in
skilled hands, but create danger of hurting yourself if you're unskilled - a
danger that doesn't exist with safety razors / debit cards.

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jammygit
The Starcraft community requested subscription content for years during the
hots years. The popular reasoning was that the game needed refreshing and
updating but that a company can’t afford to do it without incentives - and the
ongoing revenue would incentivize them to keep the game in great shape.

Then again, you can’t use subscription software at all after the company
completely moves on either - no windows 95 compatibility mode to keep using
your expensive desktop applications. So you still end up with unusable
software eventually - longer peak but a shorter life for more cost

The fundamental problem is how difficult and expensive it is to make software
and maintain it year after year

~~~
jedberg
It doesn’t have to be that way though. The company can open source the server.

They could also release a final patch that unlocks all content and removes the
license check.

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tracer4201
I signed up for “subscribe and save” because it gave me like a 5% discount on
my Protein purchase from Amazon.

Before the next 5 lb jar was supposed to get sent, they sent me an email
saying they were about to charge me and I had until X date to cancel.

You can make subscriptions work if your intentions are good and you’re not
looking at them as a revenue stream based on people forgetting to cancel.

I ended up cancelling that next shipment but ordered again a few weeks later.

The model isn’t bad. Just depends on the execution.

~~~
whinythepooh
> You can make subscriptions work if your intentions are good

I am afraid investors only care about growth. First they are going to grow
untill no more subscribers. Preferably the company will have monopolistic
position by that time. Then they will start increasing rates up to "what
market will bear". Then they will start tweaking "personalizing" experience
with microtransactions etc trying to squeeze more. Add regulatory capture to
this. This rent-seeking won't stop.

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Guest42
A year ago I downloaded an interval running app for 10 dollars. Recently I
recommended it to a family member only to find out they changed the pricing to
10 dollars per month for the same features.

~~~
ianai
You can’t tell me that interval running app is as useful to you as a Spotify
subscription. 10/mo is pretty steep comparatively!

~~~
chooseaname
I bet it's all the "social" features running apps cram in now. Last time I
looked (admittedly a couple years now) it was slim picking if you wanted an
app that didn't sync your data to the cloud or offer some sort of social
feature.

I stopped using apps. I run to clear my head and try to stay healthy, not brag
that I run.

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neonate
[http://archive.is/VryJ4](http://archive.is/VryJ4)

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aidenn0
Subscriptions for SaaS are essentially a lease, and leases are almost always
preferable to sales for the one doing the leasing. See e.g. IBM[1]

[edit]

Software (and other media with a high development cost, but low marginal cost
such as films) are particularly valuable to lease, because you remove the
secondary market, which can cannibalize sales.

1:
[https://www.jstor.org/stable/40751117?seq=1](https://www.jstor.org/stable/40751117?seq=1)

~~~
whinythepooh
For SaaS I agree but subscriptions for stationary bike, for food, for printer
ink, for traktors, etc.

~~~
aidenn0
Stationary bike and tractors fit the mold perfectly; if you can't use it
without the subscription, it's effectively a lease.

Food and printer ink are different because they are consumables.

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awinder
So because of the timing on this article, the notes on Apple’s PE ratio are
interesting to consider. Apple is now trading at a P/E ratio of 23 (Microsoft
at 28), and Apple has made a point of trying to reorient / reclassify revenue
as subscription revenue over the last several years. Even still I think this
argument is rather weak, I think looking at a coarse metric like P/E to induce
a single fact is a little too much.

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aNoob7000
I wonder if sometime in the future, there is going to be subscription fatigue.

~~~
johnpowell
I'm already there. I just hate random money coming out of my account. I just
gave fastmail $130 for three years. I wish I could have given them a thousand
for lifetime so I would just never have to think about it again. I bought a
lifetime Plex Pass for $150 so I would never have to think about it again. And
no hard feelings if these services were to shut down.

I can deal with a large one time payment. A bunch of random 5 dollar a
payments a month isn't going to float. I crawl through my credit card
statements looking for oddities. And it just bugs me.

~~~
baroffoos
Selling lifetime services for something like that is very risky. It would be
like paying someone a few million dollars and then they have to try to budget
it out for the rest of their life. Also what happens if the company runs out
of money and cant continue services. You have already paid for a lifetime
subscription but they have no money to give you a refund.

~~~
johnpowell
That is why I said "no hard feelings". Fastmail or Plex could shut down
tomorrow. I would be disappointed, but I wouldn't scream for a refund.

As long as I felt that they tried I would be alright.

Our wonderful journey wouldn't cut it. But a simple, we went broke would be
cool.

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TheEnder8
The unintentionally amusing part: "To continue reading... Subscribe or sign
in"

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pkaye
"To continue reading... Subscribe or sign in... or disable Javascript"

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whinythepooh
Here is an alternative link in case someone cannot read the article because of
paywall

[https://www.zuora.com/2018/12/09/how-subscriptions-are-
remak...](https://www.zuora.com/2018/12/09/how-subscriptions-are-remaking-
corporate-america/)

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lioeters
Can't read the article: "Subscribe or Sign In to continue reading".

~~~
whinythepooh
[https://www.zuora.com/2018/12/09/how-subscriptions-are-
remak...](https://www.zuora.com/2018/12/09/how-subscriptions-are-remaking-
corporate-america/)

